Question 42

Coronado, Inc. provided the following budgeted information for March through July:

	March	April	May	June	July
Projected sales	$104700	$122600	$115500	$131600	$141800
Projected merchandise purchases	$82100	$92800	$75100	$66900	$73300
Inventory at end of month	$12200	$14000	$12000	$12900	$14100

• Coronado estimates that it will collect 30% of its sales in the month of sale and 70% in the month after the sale.
• General operating expenses are budgeted to be $30900 per month of which depreciation is $3200 of this amount. Coronado pays operating expenses in the month incurred.
• The income tax rate is 40%.

How much is budgeted net income for May?

$7190.

$7500.

$4500.

$9500.