3. Determine budgeted cost of good sold for each quarter. Quarter 1 Quarter 2 Quarter 3 Budgeted Cost of Goods Sold 4. Determine selling and administrative expenses for each quarter. Quarter 2 Quarter 1 Quarter 3 Budgeted Selling and Administrative Expenses 5. Complete the budgeted income statement for each quarter. RED CANYON T-SHIRT COMPANY Budgeted Income Statement Quarter 1 Quarter3 Quarter 2 Budgeted Gross Margin Budgeted Net Operating Income Red Canyon T-shirt Company operates a chain of T-shirt shops in the southwestern United States. The sales manager has provided a sales forecast for the coming year, along with the following information: Quarter 1 Quarter 2 78,000 Quarter 3 39,000 Quarter 4 78,000 Budgeted Unit Sales 49,000 Each T-shirt is expected to sell for $24. The purchasing manager buys the T-shirts for $10 each. The company needs to have enough T-shirts on hand at the end of each quarter to fill 34 percent of the next quarter's sales demand .Selling and administrative expenses are budgeted at $98,000 per quarter plus 14 percent of total sales revenue