1. Do you think it was important for Michael to stipulate his four criteria for the business

(see page CA-????), including the goal of generating a net income of at least $25,000 annually?

Why or why not?

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2. If the company has sales of $12,000 during January of the fi rst year of business, determine

the amount of variable and fi xed costs associated with utilities and maintenance

using the high-low method for each. (Round unit variable costs to three decimal

places where necessary.)

3. Using the format below, prepare a sales budget for the year ending 2013.