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Part $1$

You are evaluating a new product. In year $3$ of your$$ analysis, you are projecting pro forma sales of $$$$5\mathrm{.}75\mathrm{.}7$ million and cost of goods sold of $$$$3\mathrm{.}423\mathrm{.}42$ million. You will be depreciating a $$$$1\mathrm{.}71\mathrm{.}7$ million machine for $55$ years using$$ straight$-$line depreciation. Your tax rate is $2525\%.$Finally$,$ you expect net working capital to increase from $$$$190$ comma $000190,000$ in year $2$ to $$$$305$ comma $000305,000$ in year $3.$ What are your pro forma earnings for year$3?$ What is your pro forma free cash flow for year$3?$

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Part $1$

Complete the following pro forma statement.$($Round to the nearest$$ dollar.$)$

Pro Forma Income Statement

Year $3$

Sales

$

COGS

Depreciation

EBIT

$

Tax

Earnings

$

Add Back Depreciation

Subtract Change in NWC

Free Cash Flow

$