The following information is available for year 1 for Dancer Components:

The following information is available for year 1 for Dancer Components:

Revenues (300,000)

5,700,000

Manufacturing costs

Materials

336,000

Variable cash costs

284,800

Fixed cash costs

655,200

Depreciation (fixed)

1,998,000

Marketing and administrative

Marketing (variable, cash)

844,800

Marketing depreciation

299,200

Administrative (fixed, cash)

1,018,400

Administrative depreciation

149,600

Total costs

5,586,000

Operating profits

114,000

All depreciation charges are fixed and are expected to remain the same for year 2. Sales volume is expected to increase by 18 percent, but prices are expected to fall by 5 percent.

Material costs per unit are expected to decrease by 8 percent. Other unit variable manufacturing costs are expected to decrease by 2 percent per unit. Fixed manufacturing costs are expected to increase by 5 percent.

Variable marketing costs will change with volume. Administrative cash costs are expected to increase by 10 percent. Inventories are kept at zero. Dancer operates on a cash basis.

Required

Prepare a budgeted income statement for year 2.