Fortune, Inc., is preparing its master budget for the first quarter. The company sells a single product at a price of $25 per unit. Sales (in units) are forecasted at 39,000 for January, 59,000 for February, and 49,000 for March. Cost of goods sold is $12 per unit. Other expense information for the first quarter follows.
| |
|
|
|
|
| Commissions |
|
9 |
% |
of sales |
| Rent |
$ |
19,000 |
|
per month |
| Advertising |
|
12 |
% |
of sales |
| Office salaries |
$ |
71,000 |
|
per month |
| Depreciation |
$ |
53,000 |
|
per month |
| Interest |
|
12 |
% |
annually on a $210,000 note payable |
| Tax rate |
|
30 |
% |
|
|
Prepare a budgeted income statement for this first quarter.