The budget committee of Suppar Company collects the following data for its San Miguel Store in preparing budgeted income statements for May and June 2020.

1.		Sales for May are expected to be $1,280,000. Sales in June and July are expected to be 5% higher than the preceding month.
2.		Cost of goods sold is expected to be 75% of sales.
3.		Company policy is to maintain ending merchandise inventory at 10% of the following months cost of goods sold.
4.		Operating expenses are estimated to be as follows:

Sales salaries		$31,500 / month
Advertising		6% of monthly sales
Delivery expense		2% of monthly sales
Sales commissions		5% of monthly sales
Rent expense		$5,210 / month
Depreciation		$810 / month
Utilities		$650 / month
Insurance		$520 / month

Merchandise purchase budget is:

	May	June
Sales	1280000	1280000*1.05 = 1344000
Cost of goods sold	960000	1008000
Add: Desired ending inventory	100800	105840
Total	1060800	1113840
Less: Beginning inventory	-96000	-100800
Required purchase	964800	1013040

Ending inventory of June = 1344000*1.05*75%*10% = 105840

Prepare budgeted multiple-step income statements for each month in columnar form. Show in the statements the details of cost of goods sold:

SUPPAR COMPANY San Miguel Store Budgeted Income Statement:

For the Months of May and June, 2020

Sales

Cost of Goods Sold

Beginning Inventory

Purchases

Cost of Goods Available for Sale

Less: Ending Inventory

Cost of Goods Sold

Gross Profit

Operating Expenses

Sales Salaries

Advertising

Delivery

Sales Commissions

Rent

Depreciation

Utilities

Insurance

Total Operating Expenses

Income from Operations

Interest Expense

Income Before Income Taxes

Income Tax Expense

Net Income / Loss