RE Prepare a budgeted income statement for PROBLEM 10-7. Budgeted Income Statement [LO 2] Pinnacle Engineering, an acclaimed chemical engineering team of engineers, chemists, and other scientists, had the following income in 2017: $3,550,000 Revenue Less operating expenses: Salaries $2,400,000 63,000 Accounting services Training 182,000 Supplies 175,000 Phone and fax 3,850 Insurance 303,000 Depreciation 220,000 Utilities 35,000 Miscellaneous 7,100 Income before taxes 3,388,950 Less taxes on income 161,050 64,420 Total operating expenses Net income $ 96,630 Prepare a budgeted income statement for Pinnacle Engineering for fiscal year 2018. The following changes are expected in 2018: 1. The company is expecting a 12 percent increase in revenues because of increasing demand in the marketplace for its services. 2. Training costs are expected to increase by $50,000. 3. Supplies are expected to increase to 8 percent of revenue. 4. Phone, fax, accounting services, and insurance amounts will stay the same. 5. Depreciation expense will increase by $9,000 per year, since the company is planning to purchase equipment for $75,000. 6. Pinnacle is planning to hire a laboratory technician at a salary of $36,000 per year. 7. Utilities and miscellaneous expenses are expected to increase next year by 10 percent. 8. Taxes on income will be 40 percent. REQUIRED Luntinn and Purchases Budgets LO 2) Super Clean prod PROBLEM 10-10. Cash Budget [LO 2] In the fourth quarter of 2017, Casey Wholesalers had the following net income: Sales Less cost of sales Gross margin Selling and administration Income before taxes Income taxes Net income $650,000 300,000 350,000 250,000 100,000 35,000 $ 65,000 Purchases in the fourth quarter amounted to $375,000. Estimated data for Casey Wholesalers, Inc. for 2018 are as follows: Quarter 1 Quarter 2 Quarter 3 Quarter 4 Sales Cost of sales Purchases Selling and administration $725,000 350,000 410,000 250,000 $805,000 420,000 450,000 250,000 $875,000 500,000 525,000 250,000 $968,000 580,000 600,000 250,000 Taxes are 35 percent of pretax income and are paid in the quarter incurred. Sixty percent of sales are collected in the quarter of sale and 40 percent are collected in the next quarter. Eighty percent of purchases are paid in the quarter of purchase and 20 percent are paid in the next quarter. Selling and administrative expenses are paid in the quarter incurred except for $10,000 of depreciation included in selling and administrative expense. A capital expenditure for $75,000 is planned for the fourth quarter of 2018. REQUIRED Prepare a cash budget for each quarter of 2018