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Citrus Girl Company (CGC) purchases quality citrus produce from local growers and sells the produce via...

Citrus Girl Company (CGC) purchases quality citrus produce from local growers and sells the produce via the Internet across the United States. To keep costs down, CGC maintains a warehouse, but no showroom or retail sales outlets. CGC has the following information for the second quarter of the year:

Expected monthly sales for April, May, June, and July are $250,000, $220,000, $340,000, and $120,000, respectively.

Cost of goods sold is 25 percent of expected sales.

CGC’s desired ending inventory is 35 percent of the following month’s cost of goods sold.

Monthly operating expenses are estimated to be:

Salaries: $33,000

Delivery expense: 7 percent of monthly sales

Rent expense on the warehouse: $6,000

Utilities: $1,200

Insurance: $210

Other expenses: $310

Required:
1. Compute the budgeted cost of purchases for each month in the second quarter.

April May June
Total Cost of Budgeted purchases




2. Complete the budgeted income statement for each month in the second quarter.

Citrus Girl Company
Budgeted Income Statement
For the month Ending
April 30 May 31 June 30
Budgeted Gross Margin
Budgeted Net Operating Income
Business   Accounting   
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