MasterTech is a new software company that develops and markets productivity software for municipal government applications. In developing their income statement, the following formulas are used:
gross profit = net sales - cost of sales
net operating profit = gross profit  
administrative expenses -s elling expenses
net income before taxes = net operating profit  interest expense net income = net income before taxes  
taxes Net sales are expected to be $ 1,250,000. Cost of sales is estimated to be $ 300,000. Selling expenses have a fixed component that is estimated to be $ 90,000 and a variable component that is estimated to be 8% of net sales. Administrative expenses are $ 50,000. Interest expenses are $ 8,000. The company is taxed at a 50% rate. Develop a spreadsheet model to calculate the net income. Design your spreadsheet using good spreadsheet- engineering principles.