Data to consider in the activity Sales is expected to increase by 20% in 2017 from the 2016 sales. The following are expected to vary with sales: - Cost of sales - Cash - Other current assets Variable OC 8% of sales - Trade accounts receivable - Inventories - Trade accounts payable Depreciation expense 12% of gross PPE PPE balance is P62,000,000+15M for this year There are 2 long term loans outstanding both with interest rate of 8% total of 6,250,000 Income tax rate is 30% of the income before taxes. KMI Jolly Foods Corp Income Statement For the year 2016 Net Sales 200,000,000 Cost of sales 150,000,000 Gross Profit 50,000,000 Operating expenses 30,000,000 Income before Int & Tax 20,000,000 Interest Expense 2,500,000 Income before taxes 17,500,000 Taxes 7,000,000 Net Income 10,500,000