Holly Company prepared the following budgeted income statement for the first quarter of 2018: (Click the icon to view the budgeted income statement.) Holly Company is considering two options (Click the icon to view the options.) Read the requirements Requirement 1. Prepare budgeted income statements for both options, assuming both options begin in January and January sales remain $8,000. Round all calculations to the nearest dollar Begin by preparing the budgeted income statement for Option 1 Holly Company Budgeted Income Statement For the Quarter Ended March 31, 2018 January February March Total Sales Revenue Cost of Goods Sold Gross Profit S and A Expenses Operating Income Income Tax Expense Net Income Now prepare the budgeted Income statement for Option 2. (Round all amounts to the nearest whole number) Holly Company Nina Enter any number in the edit fields and then continue to the next question. statement for the first quarter of 2018: ent.) Holly Company is considering two options. (Click the icon to view the options.) Data Table - X For bol It dollar Option ent 31, 201 M March Total 29,120 Holly Company Budgeted Income Statement For the Quarter Ended March 31, 2018 January February Net Sales Revenue (20% increase per month) $ 8,000 $ 9,600 $ Cost of Goods Sold (40% of sales) 3,200 3,840 Gross Profit 4,800 5,760 S and A Expenses ($2,000 + 10% of sales) 2,800 2.960 Operating Income 2,000 2,800 Income Tax Expense (30% of operating income) 600 840 Net Income $ 1,400 $ 1,960 $ 11,648 11,520 $ 4,608 6,912 3,152 17,472 8,912 3,760 1,128 8,560 2,568 5,992 2,632 $ on 2.(RI Print Done nue to the next question. Read the requirements. ons, assuming both options begin in January and January sales remain $8,000. Round all calculations to the i More Info Option 1 is to increase advertising by $1,500 per month. Option 2 is to use better-quality materials in the manufacturing process. The better materials will increase the cost of goods sold to 45% but will provide a better product at the same sales price. The marketing manager projects either option will result in sales increases of 25% per month rather than 20%. Print Done d all amounts to the nearest whole number.) next question View the budgeted income statement Company is considering two options Click the icon to view the options) Read the moments Now prepare the budgeted income statement for Option 2. (Round al amounts to the nearest whole number) Helly Company Budgeted Income Statement For the Quarter Ended March 31, 2018 January February March Total Sales Revenue Cost of Goods Sold Gross Profit Sand A Expenses Opening income Income Tax Expense Net Income Requirement 2. Which option should Holly choose? Explain your reasoning one of the two options in chosenit would be because net income for the quarter is erected to be higher under this option. However, because both options we expected to yield currently budgeted, Holy may decide not come theater and the 5.2 Enter any number in the folds and then continue to the next Gestion Budgeted Income Statement For the Quarter Ended March 31, 2018 January February March Total Revenue of Goods Sold Profit dA Expenses rating Income ome Tax Expense Income equirement 2. Which option should not to choose either of the options. to choose Option 1. to choose Option 2 the quarter is expected to be higher under this option. However, because both options are one of the two options is chosen, it currently budgeted, Holly may decide Enter any number in the edit fields and then continue to the next question Holly Company Budgeted Income Statement For the Quarter Ended March 31, 2018 January February March Total nue ods Sold it expenses Income ax Expense me ment 2. Which option should Holly choose? Explain your reasoning. the two options is chosen, it would be because net income for the quarter is expected to be higher under this option. However, becaus y budgeted, Holly may decide Option 1 ny number in the edit fields and then Option 2 ext question equirements mis option. However, because both options are expected to yield net income for the quarter tt higher lower