Construct a pro forma income statement for the first year and second year for the following assumptions:
- Units of Sales in Year 1: 110,000
- Price per Unit: $11
- Variable cost per unit: 25%
- Fixed Costs: $129,000
- Income taxes: 20%
- Interest Expense: $170,000
In year 2, Price per unit increases to $13.50, and unit of sales increases by 4%, all other assumptions remain the same.