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Christy enterprises reports the year-end information from 2011 as follows:
Sales (100,000 units)………………………………………………………..$500,000
Less: Cost of goods sold…………………………………………………….300,000
Gross profit……………………………………………………………………….200,000
Operating expenses (includes $20,000 of Depreciation)…………120,000
Net Income………………………………………………………………………..$80,000
Christy is developing the 2012 budget. In 2012 the company would like to increase selling prices by 10%, and as a result expects a decrease in sales volume of 5%. Cost of goods sold as a percentage of sales is expected to increase to 62%. Other than depreciation, all operating costs are variable.
What is net income for 2012?