A B C D E F G 1 P9.5 Prepare purchases and income statement budgets for a merchandiser 2 3 The budget committee of Suppar Company collects the following data for its San Miguel 4 Store in preparing budgeted income statements for May and June 2022. 5 6 7 1. Sales for May are expected to be $800,000. Sales in June and July are expected to be 5% higher than the preceding month. 8 2 Cost of goods sold is expected to be 75% of sales. 906 3. Company policy is to maintain ending merchandise inventory at 10% of the following month's cost of goods sold. 4. Operating expenses are estimated to be as follows: Sales salaries Advertising 11 12 13 14 Delivery expense 15 Sales commissions 16 Rent expense 17 Depreciation 18 $35,000 per month 6% of monthly sales 2% of monthly sales 5% of monthly sales $5,000 per month 19 Utilities Insurance $800 per month $600 per month $500 per month 20 5. Interest expense is $2,000 per month. Income taxes are estimated to be 20% of 21 22 income before income taxes. 23 Instructions 24 a. Prepare the merchandise purchases budget for each month in columnar form. 25 b. Prepare budgeted income statements for each month in columnar form. Show in the 26 27 statements the details of cost of goods sold. 28 NOTE: Enter a formula, a cell reference, or a value (if you are unable to reference a cell), 29 into the yellow shaded input cells. 30 31 32 33 34 SUPPAR COMPANY San Miguel Store 50 11 H