Lilliput, a one-product mail-order firm, buys its product for $55 per unit and sells it for $135 per unit. The sales staff receives a 10% commission on the sale of each unit. Its December income statement follows. LILLIPUT COMPANY Income Statement For The Month Ended December 31, 2011 Sales $1.350.000 Cost of goods sold 550,000 800,000 Gross profit Expenses Sales commissions (10%) Advertising Store rent Administrative salaries Depreciation Other expenses 135,000 210.000 24,500 42,500 52,500 12,500 Total expenses 477,000 Net profit $ 323,000 Management expects December's results to be repeated in January, February, and March of 2012 without any changes in strategy. Management, however, has an alternative plan. It believes that unit sales will increase at a rate of 10% each month for the next three months (beginning with January) if the item's selling price is reduced to $120 per unit and advertising expenses are increased by 25% and remain at that level for all three months. The cost of its product will remain at $55 per unit, the sales staff will continue to earn a 10% commission, and the remaining expenses will stay the same Required: 1. Prepare budgeted income statements for each of the months of January, February, and March that show the expected results from implementing the proposed changes. (Input all amounts as positive values. Omit the "$" sign in your response.) Required: 1. Prepare budgeted income statements for each of the months of January, February, and March that show the expected results from implementing the proposed changes. (Input all amounts as positive values. Omit the "$" sign in your response.) LILLIPUT COMPANY Budgeted Income Statement For Months of January February, and March January February ary March Sales Cost of goods sold Gross profit Expenses Sales commissions Advertising Store rent Administrative salaries Depreciation Other expenses Total expenses Net profit