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 orecast 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: Adjustments for the change in inventory and for income taxes have not been made. The scheduled production for this year is 415,000 units, and planned sales volume is 365,000 units. Sales and production volume was 265,000 units last year. The company uses a fullabsorption costing and FIFO inventory system and is subject to a 40 percent income tax rate. The actual income statement for last year follows: Prepared a budgeted income statement and balance sheet. PANTHER CORPORATION Budgeted Income Statement For the Year Ended December 31, Year 2 Revenue: \begin{tabular}{|l|l|l|} \hline Sales revenue & & \\ \hline Other income & & \\ \hline Total Revenue & & \\ \hline Expenses: & & \\ \hline Cost of goods manufactured \& sold: & \\ \hline Materials & & \\ \hline Direct labor & & \\ \hline Variable overhead & & \\ \hline Fixed overhead & & \\ \hline & & \\ \hline Beginning inventory & & \\ \hline & & \\ \hline Ending inventory & & \\ \hline Marketing: & & \\ \hline Salaries & & \\ \hline Commissions & & \\ \hline Promotions and advertising & & \\ \hline Administrative: & & \\ \hline Salaries & & \\ \hline Travel & & \\ \hline Office costs & & \\ \hline Income taxes (credit) & & \\ \hline Total expenses & & \\ \hline Operating profit (loss) & & \\ \hline \end{tabular} PANTHER CORPORATION Budgeted Balance Sheet Budgeted December 31, Year 2 Current Assets \begin{tabular}{|l|l|l|} \hline & & \\ \hline & & \\ \hline & & \\ \hline & & \\ \hline Total current assets & & \\ \hline & & \\ \hline & & \\ \hline Total assets & & \\ \hline Current liabilities & & \\ \hline & & \\ \hline & & \\ \hline & & \\ \hline & & \\ \hline Total shareholders' equity & & \\ \hline Total liabilities and shareholders' equity & & \\ \hline \end{tabular}