Brownsville Novelty Store prepared the following budget information for the month of May: • Sales are budgeted at $324,000. All sales are on account and a provision for bad debts is made for each month at three percent of sales for the month. • Inventory was $94,000 on April 30; an inventory increase of $21,000 is planned for May 31. • All inventory is marked to sell at cost plus 50 percent. • Estimated expense for selling and administrative expenses for the month are $58,000. • Depreciation for May is projected at $7,000. Brownsville's budgeted operating income for May is: Multiple Choice $40,280. $12,280. $33,280. $86,000. $87,000.

Brownsville Novelty Store prepared the following budget information for the month of May: • Sales are budgeted at $324,000. All sales are on account and a provision for bad debts is made for each month at three percent of sales for the month. • Inventory was $94,000 on April 30; an inventory increase of $21,000 is planned for May 31. • All inventory is marked to sell at cost plus 50 percent. • Estimated expense for selling and administrative expenses for the month are $58,000. • Depreciation for May is projected at $7,000. Brownsville's budgeted operating income for May is: Multiple Choice $40,280. $12,280. $33,280. $86,000. $87,000.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 3PA: Echo Amplifiers prepared the following sales budget for the first quarter of 2018: It also has this...

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