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Use the following income statement along with the accompanying additional information to prepare a monthly operational budget for Tom's Business. Additional Information: Sales are anticipated to increase by 5% each month Cost of Goods Sold will remain at its current percentage of sales Rent is going up to $550 per month next year Wages should run at 6% of sales Utilities and auto maintenance will remain the same Advertising will increase by 10% in the same months as the current year 2019 Sales Cost of Goods Sold Rent Wages Insurance Utilities. Auto Maintenance Advertising Other Expenses Total Expenses Net Income Jan 3,250 1,788 525 175 46 220 40 98 2.891 360 285 80 May Feb Mar Apr Jun 2,700 3,856 3,254 3.650 2,850 1,485 2,120 1,790 2008 1,568 525 525 525 525 175 175 175 46 46 46 225 40 60 116 175 46 Tom's Business Income Statement 227 40 2019 200 40 525 175 46 185 80 60 86 Jul 2,600 1,430 1,106 525 175 46 525 175 46 206 40 Aug Sep 2010 2.200 78 2,499 101 266 40 60 2217 1,210 525 175 (207) 210 80 60 86 81 98 110 2577 3,407 2.900 3,103 2,724 123 448 354 547 126 According to your 2020 operational budget: a. What are your estimated sales for January 2020? b. What is your estimated cost of goods sold for February 2020? 2372 Oct (172) Nov 2.250 3,755 1,238 2,065 525 525 175 175 46 46 220 40 186 40 B 2.276 (26) 113 3,184 571 c. What is your estimate in wages for June 2020? d. What is your estimate in advertising expense for March 2020? e. What is your estimated net income for September 2020? Dec Total 4,890 37,264 2,690 20,495 525 175 46 230 80 80 147 3.962 938 6,300 2,100 SEO 2,657 640 240 1,118 34,100 3,164

Use the following income statement along with the accompanying additional information to prepare a monthly operational budget for Tom's Business. Additional Information: Sales are anticipated to increase by 5% each month Cost of Goods Sold will remain at its current percentage of sales Rent is going up to $550 per month next year Wages should run at 6% of sales Utilities and auto maintenance will remain the same Advertising will increase by 10% in the same months as the current year 2019 Sales Cost of Goods Sold Rent Wages Insurance Utilities. Auto Maintenance Advertising Other Expenses Total Expenses Net Income Jan 3,250 1,788 525 175 46 220 40 98 2.891 360 285 80 May Feb Mar Apr Jun 2,700 3,856 3,254 3.650 2,850 1,485 2,120 1,790 2008 1,568 525 525 525 525 175 175 175 46 46 46 225 40 60 116 175 46 Tom's Business Income Statement 227 40 2019 200 40 525 175 46 185 80 60 86 Jul 2,600 1,430 1,106 525 175 46 525 175 46 206 40 Aug Sep 2010 2.200 78 2,499 101 266 40 60 2217 1,210 525 175 (207) 210 80 60 86 81 98 110 2577 3,407 2.900 3,103 2,724 123 448 354 547 126 According to your 2020 operational budget: a. What are your estimated sales for January 2020? b. What is your estimated cost of goods sold for February 2020? 2372 Oct (172) Nov 2.250 3,755 1,238 2,065 525 525 175 175 46 46 220 40 186 40 B 2.276 (26) 113 3,184 571 c. What is your estimate in wages for June 2020? d. What is your estimate in advertising expense for March 2020? e. What is your estimated net income for September 2020? Dec Total 4,890 37,264 2,690 20,495 525 175 46 230 80 80 147 3.962 938 6,300 2,100 SEO 2,657 640 240 1,118 34,100 3,164

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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100%
Round percentages and ratios to the nearest tenth of a percent, dollars to nearest whole dollar. 2. a. ________dollars b. ________ dollars c. ________ dollars d. ________ dollars e. ________ dollars
**Income Statement and Budget Preparation for Tom’s Business** **Instructions:** Use the following income statement along with the accompanying additional information to prepare a monthly operational budget for Tom’s Business. **Additional Information:** - Sales are anticipated to increase by 5% each month. - Cost of Goods Sold will remain at its current percentage of sales. - Rent is going up to $550 per month next year. - Wages should run at 6% of sales. - Utilities and auto maintenance will remain the same. - Advertising will increase by 10% in the same months as the current year. **Income Statement for 2019:** | 2019 | Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | Total | |--------------|-------|------|------|------|-----|------|------|------|------|------|------|------|---------| | Sales | 3,250 | 2,700| 3,385| 3,254| 3,650|2,850 | 2,600| 2,010| 2,200| 2,250| 3,775| 4,890| 37,484 | | Cost of Goods Sold | 1,788 | 1,485| 1,862| 1,792| 2,012| 1,570| 1,430| 1,105| 1,210| 1,238| 2,077| 2,686| 20,255 | | Rent | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 3,900 | | Wages | 175 | 175 | 175 | 195 | 219 | 171 | 156 | 120 | 132 | 135 | 226 | 293 | 2,072 | | Insurance | 25 | 25 | 25 | 25 | 25 | 25 | 44 | 44 | 44 |
Transcribed Image Text:**Income Statement and Budget Preparation for Tom’s Business** **Instructions:** Use the following income statement along with the accompanying additional information to prepare a monthly operational budget for Tom’s Business. **Additional Information:** - Sales are anticipated to increase by 5% each month. - Cost of Goods Sold will remain at its current percentage of sales. - Rent is going up to $550 per month next year. - Wages should run at 6% of sales. - Utilities and auto maintenance will remain the same. - Advertising will increase by 10% in the same months as the current year. **Income Statement for 2019:** | 2019 | Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | Total | |--------------|-------|------|------|------|-----|------|------|------|------|------|------|------|---------| | Sales | 3,250 | 2,700| 3,385| 3,254| 3,650|2,850 | 2,600| 2,010| 2,200| 2,250| 3,775| 4,890| 37,484 | | Cost of Goods Sold | 1,788 | 1,485| 1,862| 1,792| 2,012| 1,570| 1,430| 1,105| 1,210| 1,238| 2,077| 2,686| 20,255 | | Rent | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 325 | 3,900 | | Wages | 175 | 175 | 175 | 195 | 219 | 171 | 156 | 120 | 132 | 135 | 226 | 293 | 2,072 | | Insurance | 25 | 25 | 25 | 25 | 25 | 25 | 44 | 44 | 44 |
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