The hospitals marketing and finance departments have just provided you, as chief financial officer, with pro forma income statements for your proposed sonogram center. These statements appear in the following.

Pro forma Income Statement (000)

Time t + 1 t + 2 t + 3 t + 4

Service Revenues (net) $425 $500 $580 $700

Expenses $400 $450 $525 $600

Depreciation Expense $35 $35 $35 $35

Net Income ($10) $15 $20 $65