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Sales DOM Merline Manufacturing makes its product for $55 per unit and sells it for $547 per unit. The sales staff receives a commission of 10% of sales. Its December income statement follows. HEREINE MUTACTURING Income Statement Yor Month Unded December 31.470,000 Cont of goods sold 550.000 Gross profit 920,000 Selling eral, and administrative expenses Sales commissions (10) $ 147,000 Advertising 234,000 office rent 25,700 Administrative salaries 48,500 Depreciation office equipment 588.500 office nuance 13,700 527,400 Het income 6392,500 Management expects December's results to be repeated in January, February, and March without any changes in strategy Management, however, has an alternative plan. It belleves that if the unlt selling price is reduced to $132 per unit and advertising is increased to $269,100 per month, sales units will be 11.000 for January 12,100 for February, and 13,310 for March. The cost of its product will remain at $55 per unit, the sales staff will continue to earn a 10% commission, and the remaining expenses will stay the same. onces Required: 1. Prepare budgeted income statements for each of the months of January February, and March that show results from implementing the proposed plan. 2. For the proposed plan, is income in March budgeted to be higher than income in December? MERLINE MANUFACTURING Budgeted Salos January February March Budgeted sales (in dollars) MERLINE MANUFACTURING Budgeted Income Statement January February March Selling, general, and administrative expenses Sales commissions Advertising Office rent Administrative salaries Depreciation Office equipment Office Insurance Total expenses For the proposed plan, is income in March budgeted to be higher than income in December? For the proposed plan, is income in March budgeted to be higher than income in December?