Sports Bars, Inc., produces energy bars. Management estimates all selling and administrative costs are fixed. Quarterly selling and administrative cost estimates for the coming year follow:

Costs	Value
Salaries	$170,000
Rent	$65,000
Advertising	$120,000
Depreciation	$75,000
Other	$36,000

Sales budget for the year:

	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Year
Projected sales in units	80,000	84,000	88,000	97,000	349,000
Sales price per unit	$25	$25	$25	$25	$25
Sales revenue*	$2,000,000	$2,100,000	$2,200,000	$2,425,000	$8,725,000

* Sales revenue equals projected sales in units x sales price per unit

Required:

1. Use the information presented above to prepare a selling and administrative budget. Refer to the format shown in Table 9.4.
2. Use the information from the sales table above to prepare a budgeted income statement. Refer to the format shown in Table 9.5.
3. How will management use the information presented in the budgeted income statement?

POBLEMS (continued) 40. Selling and Administrative Budget and Budgeted Income Statement a. Selling and administrative budget 40. Selling and Administrative Budget and Budgeted Income Statement (continued) b. Divdratad innomana atntamant POBLEMS (continued) 40. Selling and Administrative Budget and Budgeted Income Statement a. Selling and administrative budget 40. Selling and Administrative Budget and Budgeted Income Statement (continued) b. Divdratad innomana atntamant