The Bandeiras Corporation, a merchandising firm, has budgeted its activity for December according to the following information:

• Sales at $560,000, all for cash.
• Merchandise inventory on November 30 was $255,000.
• The cash balance at December 1 was $29,000.
• Selling and administrative expenses are budgeted at $93,000 for December and are paid in cash.
• Budgeted depreciation for December is $47,000.
• The planned merchandise inventory on December 31 is $285,000.
• The cost of goods sold is 70% of the sales price.
• All purchases are paid for in cash.
• There is no interest expense or income tax expense.

The budgeted cash receipts for December are:

The Bandeiras Corporation, a merchandising firm, has budgeted its activity for December according to the following information:

• Sales at $550,000, all for cash.
• Merchandise inventory on November 30 was $300,000.
• The cash balance at December 1 was $25,000.
• Selling and administrative expenses are budgeted at $60,000 for December and are paid in cash.
• Budgeted depreciation for December is $35,000.
• The planned merchandise inventory on December 31 is $270,000.
• The cost of goods sold is 75% of the sales price.
• All purchases are paid for in cash.
• There is no interest expense or income tax expense.

The budgeted net income for December is:

Multiple Choice

• $107,500

• $137,500

• $42,500

• $77,500