98)

Assume a merchandising company provides the following information from its master budget for the month of May:

Sales	$	136,000
Cash paid for merchandise purchases	$	90,000
Selling and administrative expenses	$	30,000
Accounts payable, May 1st	$	23,400
Accounts payable, May 31st	$	31,000

If the company maintains no beginning or ending merchandise inventory and makes all of its inventory purchases on account, what is the budgeted net operating income for May?

Multiple Choice

• $31,000

• $8,400

• $16,800

• $39,400