The income statement, also known as the profit and loss (P&L) statement, provides a snapshot of the financial performance of a company during a specified period of time. It reports a firm's gross income, expenses, net income, and the income that is available for distribution to its preferred and The income statement is prepared using the generally accepted accounting principles (GAAP) that match the firm's revenues and expenses to the period in which they were incurred, not necessarily when cash was received or paid. Investors and analysts use the information given in the income statement and other financial statements and reports to evaluate the company's financial performance and condition. Consider the following scenario: Fuzzy Button Clothing Company's income statement reports data for its first year of operation. The firm's CEO would like sales to increase by 25% next ear Fuzzy Button is able to achieve this level of increased sales, but its interest costs increase from 10% to 15% of eamings before interest and taxes (EBIT). The company's operating oosts (excluding depreciation and amortization) remain at 70% of net sales, and its depreciation and amortization expenses The oompany's tax rate remains constant at 40% of its pre-tax income or eamings before taxes (EBT). In Year 2, Fuzzy Button expects to pay $2DD,DDD and $768,825 of preferred and common stock dividends, respectively 1. 2. remain constant from year to year 3. 4. Complete the Year 2 income statement data for Fuzzy Button, then answer the questions that follow. Be sure to round each dollar value to the nearest whole dollar Fuzzy Button Clothing Company Income Statement for Year Ending December 31 Year 2 Year 1 (Forecasted) Net sales $15,000,0DD 10,50D,0DD 500,0DD $3,S00,0DD 390,00D 3,510,000 1,404,DDD $2,105,0DD 200,000 1,9D5,0DD 631,800 $1,274,200 Less: Operating costs, except depreciation and amortization Less: Depreciation and amortization expenses 500,0DD Operating income (or EBIT) Pre-tax income (or EBT Earnings after taxes Earnings available to common shareholders Contribution to retained eamings Less: Interest expense Less: Taxes (40%) Less: Preferred stock dividends Less: Common stock dividends $1,593,925 Given the results of the previous income statement calculations, complete the following statements: .In Year 2, if Fuzzy Button has 5,00D shares of preferred stock issued and outstanding, then each preferred share should expect to receive in annual dividends