Calgary Industries is preparing a budgeted income statement for 2018. Predicted sales for the year are $700,000 and cost of goods sold is 40% of sales. The expected selling expenses are $78,000 and the expected general and administrative expenses are $87,000, which includes $20,000 of depreciation. The company's income tax rate is 30%. The budgeted net income for 2018 is:

• $420,000.

• $178,500.

• $255,000.

• $85,100.

• $76,500.