Question 3 Imagine that you are a sales manager in IFC Clothing Department. You were asked to prepare a budgeted income statement for the department for the rst two months of the coming year. You have the following information: a. Sales in December were $300,000. Sales were expected to increase 50% in January due to New Year's sales and increase 30% in both February and March. (Note: the change rates are monthly change rates compared to the previous months, i.e., (sales in t)/ (sales in t-1)* l 00%) The department plans to continue maintaining an ending inventory of 40% of the budgeted sales revenue for the following month. Monthly purchases average 30% of the sales revenue in the same month. The actual ending inventory in December was $110,000. Additional part-time staff will be hired in January due to New Year's sales. The budgeted amount of increase in salary expense is $25,000. Other information are as follows: Monthly salary expense: $60,000, paid as incurred Depreciation expense: $2,000 Insurance expense:$7,000, expiration of prepaid amount Income tax: 30% of operating income Required (25 points in total): Prepare the budgeted income statement for January and February. Show the cost of goods sold calculations