Calgary Industries is preparing a budgeted income statement for 2018. Predicted sales for the year are $725,000 and cost of goods sold is 40% of sales. The expected selling expenses are $80,500 and the expected general and administrative expenses are $89,500, which includes $22,500 of depreciation. The company's income tax rate is 30%. The budgeted net income for 2018 is:

Multiple Choice

• $435,000.

• $185,500.

• $265,000.

• $85,600.

• $79,500.

  Fortune Company's direct materials budget shows the following cost of materials to be purchased for the coming three months:

  		January		February		March
  Material purchases		$ 13,180		$ 15,290		$ 12,110

  Payments for purchases are expected to be made 50% in the month of purchase and 50% in the month following purchase. The December Accounts Payable balance is $7,900. The expected January 31 Accounts Payable balance is:

  Multiple Choice

• $7,900.

• $7,645.

• $13,180.

• $6,590.

• $10,540.