Prepare a new income statement with the expected changes. Show all work and show entire income statement.

CP 6-4 Communication Suzi Nomro operates Watercraft Supply Company, an online boat parts distributorship that is in its third year of operation. The following income statement was prepared for the year ended October 31, 2019. cation Watercraft Supply Company Income Statement For the Year Ended October 31, 2019 $1,350,000 15,000 $1,365,000 Revenues: Sales Interest Total revenues Expenses: Cost of merchandise sold Selling expenses Administrative expenses... Interest expense.. Total expenses Net income $810,000 140,000 90,000 4,000 1,044,000 $ 321,000 Suzi is considering a proposal to increase net income by offering sales discounts of 2/15, n/30 and by shipping all merchandise FOB shipping point. Currently, no sales dis- counts are allowed and merchandise is shipped FOB destination. It is estimated that the new terms will increase sales by 10%. The ratio of the cost of merchandise sold to sales is expected to be 60%. All selling and administrative expenses are expected to remain unchanged, except for store supplies and miscellaneous selling expenses, which are ex- pected to increase proportionately with increased sales. The amounts of these items for the year ended October 31, 2019, were as follows: Store supplies expense Miscellaneous selling expenses $12,000 6,000 The interest revenue and expense items will remain unchanged. The shipment of all merchandise FOB shipping point will eliminate all delivery expenses, which for the year ended October 31, 2019, were $12,000. (Continued)