You are provided with the following information regarding XYZ Corp. Prepare the Income Statement for the years ending 20X7 and 20X8 and balance sheets as at 12/31/20X7 and 12/31/20X8. Be sure to clearly show Operating income, Net income, Total current assets, Total current liabilities, Total liabilities and shareholders equity in your financial statements. (All figures are in $million). Show and explain all your computations.

Item	20X7	20X8
Interest charges on capital leases	267	253
Interest charges on debt	729	934
Interest Income	164	201
Cost of sales	198,747	219,793
Sales revenue	256,329	285,222
Income from membership fees	2,352	2,767
Selling, general and administration (SG&A) expenses	28,404	30,187
Other operating expenses	16,505	20,918
Depreciation and Amortization charge for the year	3,852	4,405
Cash and cash equivalents	5,199	5,488
Taxes for the year	5,120	5,590
Accounts receivables	1,254	1,715
Inventories	26,612	29,447
Prepaid expenses	1,356	1,841
Notes payable	3,267	3,812
Accounts payable	19,425	21,671
Accrued liabilities due in 6 months	10,671	12,155
Accrued income taxes due within one year	1,377	1,281
Long term debt and capital leases due within one year	3,100	3,969
Long term debt	20,945	24,357
Long term obligations under capital leases	2,997	3,582
Land at cost	12,700	14,472
Buildings and improvements	40,192	46,582
Fixtures and equipment at cost	17,834	21,461
Transportation equipment at cost	1,270	1,530
Goodwill	16,247	18,162
Accumulated depreciation for all fixed assets	15,684	18,637
Accumulated Amortization for the goodwill	3,673	3,838
Dividends paid	1,570	2,214

The retained earnings for the year ending 12/31/20X6 was $35,636 million.