Varmit-B-Gone is a pest control service that operates in a suburban neighborhood. The company attempts to make service calls at least once a month to all homes that subscribe to its service. It makes more frequent calls during the summer. The number of subscribers also varies with the season. The number of subscribers and the average number of calls to each subscriber for the months of interest follow:

	Subscribers	Service calls (per subscriber)
March		1,150			0.6
April		1,250			0.9
May		1,950			1.5
June		2,150			2.5
July		2,150			3.0
August		2,000			2.4

The average price charged for a service call is $80. Of the service calls, 30 percent are paid in the month the service is rendered, 60 percent in the month after the service is rendered, and 8 percent in the second month after. The remaining 2 percent is uncollectible.

Varmit-B-Gone estimates that the number of subscribers in September should fall 10 percent below August levels, and the number of service calls per subscriber should decrease by an estimated 20 percent. The following information is available for costs incurred in August. All costs except depreciation are paid in cash.

Service costs
Variable costs	$	18,000
Maintenance and repair		16,000
Depreciation (fixed)		36,000
Total	$	70,000
Marketing and administrative costs
Marketing (variable)	$	45,000
Administrative (fixed)		99,000
Total	$	144,000
Total costs	$	214,000

Variable service and marketing costs change with volume. Fixed depreciation will remain the same, but fixed administrative costs will increase by 5 percent beginning September 1. Maintenance and repair are provided by contract, which calls for a 1 percent increase in September.

Required:

Prepare a budgeted income statement for September.(Round intermediate calculations to 2 decimals places.)

Varmit-B-Gone is a pest control service that operates in a suburban neighborhood. The company attempts to ma subscribe to its service. It makes more frequent calls during the summer. The number of subscribers also varies with the se number of calls to each subscriber for the months of interest follow: Subscribers 1,150 1,250 1,950 2,150 2,150 2,000 March April May June July August Service calls (per subscriber) 0.6 0.9 1.5 2.5 3 2.4 The average price charged for a service call is $80. Of the service calls, 30 percent are paid in the month the service is rendered, 60 percent in the month after the service is rendered, and 8 percent in the second month after. The remaining 2 percent is uncollectible. Varmit-B-Gone estimates that the number of subscribers in September should fall 10 percent below August level number of service calls per subscriber should decrease by an estimated 20 percent. The following information is for costs incurred in August. All costs except depreciation are paid in cash. Service costs Variable costs Maintenance and repair $ Depreciation (fixed) Total Marketing and administrative costs Marketing (variable) 36,000 $ 70,000 $ 45,000 Administrative (fixed) Total Total costs 18,000 16,000 99,000 $ 144,000 $ 214,000 Variable service and marketing costs change with volume. Fixed depreciation will remain the same, but fixed adm costs will increase by 5 percent beginning September 1. Maintenance and repair are provided by contract, which calls for a increase in September. Required: Prepare a budgeted income statement for September. Varmit-B-Gone Budgeted Income Statement For the Month of September Sales Revenue Service Costs: Total Service Costs Marketing and Administrative: Total Marketing and Admin. Total Costs Operating Profit/(Loss) d. The company attempts to make service calls at least once a month to all homes that subscribers also varies with the season. The number of subscribers and the average l 10 percent below August levels, and the ent. The following information is available remain the same, but fixed administrative vided by contract, which calls for a 1 percent