PROBLEM 10-6. Budgeted Income Statement [L2] Modern Healthcare, a group practice clinic with 10 physicians, had the following income in 2017: $3,250,000 Revenue Less operating expenses: Salaries $1,300,000 152,000 68,500 50,000 45,000 120,000 250,000 3,750 275,000 242,000 19,800 66,000 Physicians Nurses Nursing aide Receptionist Accounting services Training Supplies Phone and fax Depreciation Utilities Miscellaneous Total operating expenses Income before taxes Less taxes on income Net income 2,592,050 657,950 230,283 $ 427,668 The following changes are expected in 2018: 1. The clinic is expecting a 2 percent decline in revenues because of increasing pressure from insurance companies. 2. Physicians are planning to hire a physician assistant at a salary of $50,000 per year. 3. Training costs are expected to increase by $15,000. 4. Supplies are expected to increase to be 10 percent of revenue. 5. Phone, fax, and insurance amounts will stay the same. 6. Depreciation expense will increase by $20,000 per year, since the clinic is planning to pur- chase equipment for $125,000. 7. Utilities and miscellaneous expenses are expected to increase by 5 percent next year 8. Taxes on income will be 35 percent REQUIRED Prepare a budgeted income statement for Modern Healthcare for the year 2018