fuzzy button clothing companys income statement reports data for its first year

m/at/serviet/quizictx quiz prebGuid-QNAPCOADD1010000003 274180070000&cka Fuzzy Button Clothing Company's nome statement reports data for ts first year of operation The firm's CEO would ike sales to increase by 25% next Fuzzy Button is able to achieve this level of inreased sales, but its interest costs increase from 10% to 15% of earnings before interest and taxes (EBIT) The company's operating costs (ecang depredation and amortization) rernain at 80% of net sales, so, ts depreoston and amortization expenses remain constant from year to year 1. 2. 3. The company's tax rate remains constant at 40% of its pre-tax ncome or earnings before taxes (EBT). 4. In Year 2. Fuzzy Button expects to pay $100,000 and374,850 of preferred and common stock dividends, respectively. Complete the Year 2 income statement data for Fuzzy Button, then answer the questions that follow. Be sure to round each dolar value to the nearest whole doliar. Fuzzy Button Clothing Company Income Statement for Year Ending December 31 Year 2 (Forecasted) Year 1 $10,000,000 8,000,000 Net sales Less: Operating costs, except depreciation and amortization Less: Depreciation and amortization expenses Operating income (or EBIT) Pre-tax income (or EBT) Earmings after taxes $1,600,000 160,000 1,440,000 576,000 $864,000 Less: Interest expense Less: Taxes (40%) Less: Preferred stock dividends 0 6 I O P