Pendleton Company, a merchandising company, is developing its master budget for 2015. The income statement for 2014 is as follows:

Pendleton Company Income Statement For Year Ending December 31, 2014
Gross sales	$750,000
Less uncollectible accounts	7,500
Collected sales	742,500
Cost of goods sold	430,000
Profit before operating expense	312,500
Operating expenses (including $25,000 depreciation)	200,500
Income before tax	$112,000

The following are managements goals and forecasts for 2015:

1.	Selling prices will increase by 6 percent, and sales volume will increase by 4 percent.
2.	The cost of merchandise will increase by 3 percent.
3.	All operating expenses are fixed and are paid in the month incurred. Price increases for operating expenses will be 10 percent. The company uses straight-line depreciation.
4.	The estimated uncollectibles are 2 percent of budgeted sales.

Required Prepare a budgeted functional income statement for 2015.

Do not use negative signs with any of your answers.

Pendleton Company Budgeted Income Statement For the Year Ending December 31, 2015
Sales
Less uncollectible accounts
Collected sales
Cost of goods sold
Profit before operating expense
Operating expenses
Income before tax