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 Cash Accounts receivable Inventory (January 1 Year 2) Plant and equipment Accumulated depreciation Accounts payable Notes payable (due within one Acerved payables Common stock Retained earnings Sales revenue Other in Manufacturing costs 852,000 Direct labor 872.000 Variable overhead 520,000 Depreciation 20.000 Other Fixed overhead 31,000 Marketing Commissions 80.000 64.000 Promotion and advertising 180.000 Administrative Salaries 64,000 Travel 10,000 Office costs 36,000 Income taxes Dividends 20.000 $ 3,785,800 $3,785,800 $ 3,785,800 $3,785,800 Adjustments for the change in Inventory and for Income taxes have not been made. The scheduled production for this year is 450.000 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 $1,860,000 PANTHER CORPORATION Statement of Income and Retained Earnings For the Budget Year Ended December 31, Year 1 Revenues Sales revenue $ 1,800, een Other income 60,000 Expenses Cost of goods sold Materials $ 528,000 Direct labor 540,000 Variable overhead 324.ee Fixed overhead 48,600 $1,440,000 Beginning inventory 192.000 $1,632,800 Ending inventory 192,eee $1,440,000 Selling Salaries 54,00 Comissions 60,000 Promotion and advertising 126,000 240,000 General and administrative Salaries 56,080 Travel 8,000 Office costs 32,000 96,000 Income taxes 33,600 Operating profit Beginning retained earnings Subtotal Less dividends Ending retained earnings $ 1,809,600 50,400 402,480 452,800 20,000 432,800 $ Required: Prepared a budgeted Income statement and balance sheet