Study the
appendix beginning on page 551. The Speedy-Mart Store has the following budgeted
sales, which are uniform throughout the month:

Cost of goods sold averages 70 percent of sales and is purchased as it is
needed. Employees earn fixed salaries of $22,000 (total) monthly and commissions
of 10 percent of the current month’s sales. Other expenses are rent, $6,000, paid on the first of each month; miscellaneous expenses, 6 percent of sales, paid
as incurred; insurance, $450 per month, from a one-year policy that was paid for
on January 2; and amortization, $2,850 per month.
1. Using spreadsheet software, prepare a table of budget data for the
Speedy-Mart Store. -
2. Continue the spreadsheet in requirement 1 to prepare budget schedules
for (a) disbursements for operating expenses and (b) operating
income for June, July, and August.
3. Adjust the budget data appropriately for each of the following scenarios
~ independently and recompute operating income using the spreadsheet.
a. A sales promotion that will cost $30,000 in May could increase sales
in each of the following three months by 5 percent.
b. Eliminating the sales commissionsyand increasing employees’
salaries to $52,500 per month could decrease sales thereafter by a
netiol 2 percent.

Transcribed Image Text:

May June $450,000 375,000 July 330,000 August 420,000