Question: Please start with the information from the prior problem concerning the New Madrid Corporation. In projecting the proforma second years income statement for New Madrid,

Please start with the information from the prior problem concerning the New Madrid Corporation. In projecting the proforma second years income statement for New Madrid, assume that sales increase by

25 %

in the second year of operation, variable costs of goods sold stay at

30 %

of sales, fixed cost of sales increase by

15 %

over the second year, selling and administrative cost increase by

8 %

and taxes remain at

30 %

of pretax profit. Please calculate New Madrid Corporation's projected after

-

tax income for the second year of operation.

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