Representatives of the various departments of Go Sports have assembled the following data. As the business...

Transcribed Image Text:

Representatives of the various departments of Go Sports have assembled the following data. As the business manager, you must prepare the budgeted income statements for August and September 2009. a. Sales in July were $196,000. You forecast that monthly sales will increase 3% in August and 2% in September. b. Go Sports tries to maintain inventory of $50,000 plus 20% of sales budgeted for the following month. Monthly purchases average 60% of sales revenue in that same month. Actual inventory on July 31 is $90,000. Sales budgeted for October are $220,000. c. Monthly salaries amount to $15,000. Sales commissions equal 6% of sales for that month. Combine salaries and commissions into a single figure. d. Other monthly expenses are: Rent expense... Depreciation expense. Insurance expense... prepaid amount Income tax.. $13,000 paid as incurred $4,000 $1,000, expiration of 30% of operating income Prepare Go Sports' budgeted income statements for August and September. Show cost of goods sold computations. Round all amounts to the nearest $1,000. For example, budgeted August sales are $202,000 ($196,000 x 1.03) and September sales are $206,000 ($202,000 x 1.02). Representatives of the various departments of Go Sports have assembled the following data. As the business manager, you must prepare the budgeted income statements for August and September 2009. a. Sales in July were $196,000. You forecast that monthly sales will increase 3% in August and 2% in September. b. Go Sports tries to maintain inventory of $50,000 plus 20% of sales budgeted for the following month. Monthly purchases average 60% of sales revenue in that same month. Actual inventory on July 31 is $90,000. Sales budgeted for October are $220,000. c. Monthly salaries amount to $15,000. Sales commissions equal 6% of sales for that month. Combine salaries and commissions into a single figure. d. Other monthly expenses are: Rent expense... Depreciation expense. Insurance expense... prepaid amount Income tax.. $13,000 paid as incurred $4,000 $1,000, expiration of 30% of operating income Prepare Go Sports' budgeted income statements for August and September. Show cost of goods sold computations. Round all amounts to the nearest $1,000. For example, budgeted August sales are $202,000 ($196,000 x 1.03) and September sales are $206,000 ($202,000 x 1.02).

Answer rating: 100% (QA)

Heres the budgeted income statement for Go Sports for the months of August and September 2009 along ... View the full answer