Ashmont Cycles Corporation estimates its sales for the 2021 financial year will be $500,000. No new borrowing was obtained and therefore, the interest expense will remain unchanged $1,200 during 2021. Compile the Pro forma Income statement for Ashmont Cycles Corporation for the year 2021 using percent of sales method. (3 marks) Ashmont Cycles Income Statement 2020 2019 Sales $205,000 $155,000 Cost of goods sold (106,000) (85,000) Gross Profit 99,000 70,000 Operating Expense: Selling, general and administrative expenses (58,000) (40,000) Utilities expense (6,960) (5,000) Rent expense (16,240) (10,000) Depreciation and amortization (1,080) (1,080) Total operating expenses (82,280) (56,080) Operating Income 16,720 13,920 Interest expense (1.200) (1,200) Income before Income Taxes 15,520 12,720 Income taxes (35%) (5,432) (4,452) Net Income $10,088 $8,268 Ashmont Cycles Balance Sheet As of December 31, 2019 and 2020 2019 2020 $8,000 $3,368 $2,500 $2,200 $65,000 $71,500 $1,500 $1,800 $500 $600 $77,500 $79,468 $12,000 $17,400 ($2,400) ($3.480) $9,600 $13,920 $87,100 $93,388 Assets Cash Accounts receivable Inventory Prepaid expenses Other current assets Total current assets Property, plant, and equipment Accumulated depreciation Net property, plant, and equipment Total Assets Liabilities Accounts payable Line of credit Current portion of long-term debt Accrued expenses Total Current Liabilities Long-term debt Total Liabilities Owner's Equity Contributed capital Retained earnings Total Owner's Equity $3,000 $3,200 $10,000 $10,000 $4,000 $4,000 $1,100 $1,100 $18,100 $18,300 $16,000 $12,000 $34,100 $30,300 $50,000 $50,000 $3,000 $13,088 $53,000 $63,088