PA8-6 Preparing Operating Budgets for a Merchandising Firm [LO 8-5, 8-3a, f, g, h] Red Canyon shirtCompany operates a chain of T-shirt shops in the southwestem United States. The sales manager has provided a sales forecast for the coming year, along with the following information: Quarter 1 Quarter 2 70,000 Quarter 3 35,000 Quarter 4 70,000 Budgeted Unit Sales 45,000 Each T-shirt is expected to sell for $20. The purchasing manager buys the T-shirts for $8 each. The company needs to have enough T-shirts on hand at the end of each quarter to fill 30 percent of the next quarter's sales demand Selling and administrative expenses are budgeted at $90,000 per quarter plus 18 percent of total sales revenue Required: 1. Determine budgeted sales revenue for each quarter. Quarter 1 Quarter 2 Quarter 3 Budgeted Sales Revenue 2. Determine budgeted cost of merchandise purchased for each quarter Quarter 1 Quarter 2 Quarter 3 Budgeted Cost of Merchandise Purchased