Exercise 5-30 (Part Level Submission) Bill Thomas, Bates & Hill?s controller, has received all the budgets prepared by the various operating units and is ready to compile the pro-forma financial statements for the first quarter. The company?s balance sheet of December 31 is as follows:

Cash	$ 49,200
Accounts Receivable (net)	47,970
Finished Goods Inventory	40,180
Raw Materials Inventory	6,199
Property, Plant & Equipment	246,000
Accumulated Depreciation	(61,500	)
Total Assets	$328,049
Accounts Payable	$ 14,760
Income Tax Payable	61,713
Common Stock	82,000
Retained Earnings	169,576
Total Liabilities & Owners Equity	$328,049

Quarter
Budgeted revenue	$1,156,200
Selling and administrative expense	218,448
Interest expense	2,772
Cash	25,236
Cost of Goods Sold	822,763
Accounts receivable	111,930
Direct materials	4,559
Finished goods	48,392
Acounts payable	27,224
Notes payable	33,620

Additional Information:

?	Bates & Hill plans to declare and pay dividends totaling $40,180 in January.
?	Bates & Hill plans to purchase and pay cash for a piece of land in February at a cost of $59,040.
?	Bates & Hill plans to purchase equipment in March at a cost of $49,200.
?	Depreciationfor manufacturing overhead$24,600 per month andfor selling and administrative $8,200 per month.

The company expects a 25% income tax rate, and all quarterly taxes are paid in the first month of the following quarter.

(a)Prepare Bates & Hill?s pro-forma income statement for the first quarter.

Pro-forma Income Statement
Income Before TaxesInterest ExpenseSelling & Administrative ExpenseCost of Goods SoldIncome Tax ExpenseSales Revenue	$
Income Before TaxesSelling & Administrative ExpenseInterest ExpenseCost of Goods SoldIncome Tax ExpenseSales Revenue
Non-Operating Income / (Loss)Gross MarginNet Income / (Loss)Non-Operating ExpensesOperating Income / (Loss)
Selling & Administrative ExpenseIncome Tax ExpenseIncome Before TaxesInterest ExpenseSales RevenueCost of Goods Sold
Non-Operating Income / (Loss)Non-Operating ExpensesGross MarginOperating Income / (Loss)Net Income / (Loss)
Income Tax ExpenseInterest ExpenseSales RevenueSelling & Administrative ExpenseIncome Before TaxesCost of Goods Sold
Selling & Administrative ExpenseCost of Goods SoldInterest ExpenseIncome Tax ExpenseIncome Before TaxesSales Revenue
Income Before TaxesInterest ExpenseCost of Goods SoldIncome Tax ExpenseSales RevenueSelling & Administrative Expense
Non-Operating Income / (Loss)Non-Operating ExpensesOperating Income / (Loss)Net Income / (Loss)Gross Margin	$

THIS IS A PART LEVEL SUBMISSION QUESTION, ONCE YOU HAVE ANSWERED PART A I WILL POST THE REMAINING PART IN THE COMMENTS FOR ADDITIONAL HELP