The S&H Construction Company expects to have total sales next year totaling $15,500,000. In addition, the firm pays taxes at 35 percent and will owe $280,000 in interest expense. Based on last year's operations the firm's management predicts that its cost of goods sold will be 59 percent of sales and operating expenses will total 25 percent. What is your estimate of the firm's net income (after taxes) for the coming year?

Pro-Forma Income StatementSales$15,500,000Cost of goods sold (9,145,000)Gross profit$6,355,000Operating expenses (3,875,000)Net operating income$ Interest expense (280,000)Earnings before taxes$ Taxes Net income$