Problem
The Underhill Company purchases tennis rackets from a supplier for $85 each and then sells them to its customers for $125 each. The company forecasted unit sales of
February 1,000
March 2,000
April 1,500
Ending inventory for January was 200 units and the company wants budgeted ending inventory to be 20% of the following month's forecasted sales. The company also has budgeted payroll of $12,000 and rent of $6,000 per month. For February, what dollar amount would the company report for budgeted net income?