Panther Corporation appeared to be experiencing a good year. Sales in the first quarter were one-third ahead of last year, and the sales department predicted that this rate would continue throughout the entire year. The controller asked Janet Nomura, a summer accounting intern, to prepare a draft forecast for the year and to analyze the differences from last year's results. She based the forecast on actual results obtained in the first quarter plus the expected costs of production to be completed in the remainder of the year. She worked with various department heads (production, sales, and so on) to get the necessary information. The results of these efforts follow:

PANTHER CORPORATION Expected Account Balances for December 31, Year 2
Cash	$	4,900
Accounts receivable		321,000
Inventory (January 1, Year 2)		200,000
Plant and equipment		525,000
Accumulated depreciation				$	165,000
Accounts payable					181,000
Notes payable (due within one year)					201,000
Accrued payables					94,000
Common stock					290,000
Retained earnings					500,400
Sales revenue					2,410,000
Other income					38,000
Manufacturing costs
Materials		863,000
Direct labor		900,000
Variable overhead		550,000
Depreciation		21,000
Other fixed overhead		32,000
Marketing
Commissions		82,000
Salaries		65,000
Promotion and advertising		182,000
Administrative
Salaries		65,000
Travel		10,500
Office costs		37,000
Income taxes
Dividends		21,000
	$	3,879,400		$	3,879,400

Adjustments for the change in inventory and for income taxes have not been made. The scheduled production for this year is 455,000 units, and planned sales volume is 400,000 units. Sales and production volume was 300,000 units last year. The company uses a full-absorption costing and FIFO inventory system and is subject to a 40 percent income tax rate. The actual income statement for last year follows:

PANTHER CORPORATION Statement of Income and Retained Earnings For the Budget Year Ended December 31, Year 1
Revenues
Sales revenue				$	1,870,000
Other income					64,000		$	1,934,000
Expenses
Cost of goods sold
Materials	$	530,000
Direct labor		590,000
Variable overhead		331,000
Fixed overhead		49,000
	$	1,500,000
Beginning inventory		200,000
	$	1,700,000
Ending inventory		200,000		$	1,500,000
Selling
Salaries	$	55,000
Commissions		61,000
Promotion and advertising		138,000			254,000
General and administrative
Salaries	$	56,000
Travel		6,000
Office costs		33,000			95,000
Income taxes					34,000			1,883,000
Operating profit								51,000
Beginning retained earnings								470,400
Subtotal							$	521,400
Less dividends								21,000
Ending retained earnings							$	500,400

Required:

Prepared a budgeted income statement and balance sheet.