E8-20 (Algo) Preparing a Merchandise Purchases Budget and a Budgeted Income Statement (LO 8-3h, 8-5] Citrus Girl Company (CGC) purchases quality citrus produce from local growers and sells the produce via t Internet across the United States. To keep costs down, CGC maintains a warehouse, but no showroom or retail sales outlets. CGC has the following information for the second quarter of the year: 1. Expected monthly sales for April, May, June, and July are $300,000, $270,000, $390,000, and $170,000 respectively. 2. Cost of goods sold is 45 percent of expected sales. 3. CGC's desired ending inventory is 35 percent of the following month's cost of goods sold. 4. Monthly operating expenses are estimated to be: Salaries: $38,000 Delivery expense: 7 percent of monthly sales Rent expense on the warehouse: $8,500 Utilities: $1,700 Insurance: $210 Other expenses: $310 Required: 1. Compute the budgeted cost of purchases for each month in the second quarter. 2. Complete the budgeted income statement for each month in the second quarter. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 | Required 2 Required: 1. Compute the budgeted cost of purchases for each month in the second quarter. 2. Complete the budgeted income statement for each month in the second quarter. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the budgeted income statement for each month in the second quarter. CITRUS GIRL COMPANY Budgeted Income Statement For the Month Ending April 30 $ 300,000 135,000 Budgeted Sales Revenue Budgeted Cost of Goods Sold May 31 $ 270,000 121,500 June 30 $ 390,000 175,500 $ 165,000 $ 148,500 $ 214,500 Budgeted Gross Margin Budgeted Selling and Administrative Expenses Budgeted Net Operating Income $ 95,280 $ 80,880 $ 138,480