Budgeted Income Statement Pendleton Company, a merchandising company, is developing its master budget for 2015. The income statement for 2014 is as follows:

Pendleton Company Income Statement For Year Ending December 31, 2014
Gross sales	$3,000,000
Less: Estimated uncollectible accounts	(60,000)
Net sales	2,940,000
Cost of goods sold	(1,650,000)
Gross profit	1,290,000
Operating expenses (including $25,000 depreciation)	(750,000)
Net income	$540,000

The following are managements goals and forecasts for 2015:

1.	Selling prices will increase by 6 percent, and sales volume will increase by 4 percent.
2.	The cost of merchandise will increase by 3 percent.
3.	All operating expenses are fixed and are paid in the month incurred. Price increases for operating expenses will be 10 percent. The company uses straight-line depreciation.
4.	The estimated uncollectibles are 2 percent of budgeted sales.

Required Prepare a budgeted functional income statement for 2015.

Do not use negative signs with any of your answers.

Pendleton Company Budgeted Income Statement For the Year Ending December 31, 2015
Sales	$3,307,200 Correct 1.00 points out of 1.00
Less: Estimated uncollectible accounts	(66,144)X WRONG
Net sales	3,241056 CORRECT
Cost of goods sold	(1,767,480) WRONG
Gross profit	1,473,576 CORRECT
Operating expenses	(772.500) WRONG
Net income	(701,076) WRONG