It is budget time at XYZ Retail and you are responsible for creating the budget this year. The CEO has set two targets: 1. Sales for F2024 must be 37.5% more than F2023 (that is an increase of $93,750 ) or MORE. 2. The Gross Margin for the retail busingss needs to increase to 66%. Forecasted sales To hit the sale increase, the marketing department has provided the following options: Do nothing: Sales are likely to increase 5.2% if you do nothing. Option 1: Increase the advertising \& web marketing budget to $100,000. They forecast this will increase sales by 15% Option 2: Open a second location. This location can be opened by August 1, 2024 and will increase sales by 31.7%. The rent for the new store is $2,750 /month. The monthly increase in electricty is $108, insurance is $25, wages \& salaries $2,400. You will need to purchase some new equipemnt and fixtures, so depreciation will increase $328 per $79,250 month. To open by August 1, 2024, you need to take over the store and start paying rent on July 1,2024 . Finally, you will need an extra $45,000 in inventory. Option 3: Add a caf to the existing location. This will generate $38,000 in annual sales with a 71% gross margin. You will need to remodel the storeroom and that will cost $36,000 increasing your annual depreciation by $6,500. The salaries \& wages will increase $4,000 per month. The monthly increase in electricty is $48 and insurance is $45. This $38,000 will increase inventory by $1,200. Option 4: Expand the current location and add more selection. This will generate $45,000 in annual sales. You will need to remodel the storeroom and that will cost $27,000 increasing your annual depreciation by $5,400. The salaries $45,000 & wages will increase $2,000 per month. The monthly increase in electricty is $48 and insurance is $45. You will need to add an extra $20,000 in inventory. It is budget time at XYZ Retail and you are responsible for creating the budget this year. The CEO has set two targets: 1. Sales for F2024 must be 37.5% more than F2023 (that is an increase of $93,750 ) or MORE. 2. The Gross Margin for the retail busingss needs to increase to 66%. Forecasted sales To hit the sale increase, the marketing department has provided the following options: Do nothing: Sales are likely to increase 5.2% if you do nothing. Option 1: Increase the advertising \& web marketing budget to $100,000. They forecast this will increase sales by 15% Option 2: Open a second location. This location can be opened by August 1, 2024 and will increase sales by 31.7%. The rent for the new store is $2,750 /month. The monthly increase in electricty is $108, insurance is $25, wages \& salaries $2,400. You will need to purchase some new equipemnt and fixtures, so depreciation will increase $328 per $79,250 month. To open by August 1, 2024, you need to take over the store and start paying rent on July 1,2024 . Finally, you will need an extra $45,000 in inventory. Option 3: Add a caf to the existing location. This will generate $38,000 in annual sales with a 71% gross margin. You will need to remodel the storeroom and that will cost $36,000 increasing your annual depreciation by $6,500. The salaries \& wages will increase $4,000 per month. The monthly increase in electricty is $48 and insurance is $45. This $38,000 will increase inventory by $1,200. Option 4: Expand the current location and add more selection. This will generate $45,000 in annual sales. You will need to remodel the storeroom and that will cost $27,000 increasing your annual depreciation by $5,400. The salaries $45,000 & wages will increase $2,000 per month. The monthly increase in electricty is $48 and insurance is $45. You will need to add an extra $20,000 in inventory