Corner Shoppe is a local convenience store with the following information:

Data Table

• October sales were $290,000
• Sales Are projected to go up by 12% in November (from the October sales) and another 20% in December (from the November sales) then return to the October level in January.
• 25% of sales are made in cash well the remaining 75% are paid by credit or debit cards. The credit card companies and banks (debit card issuers) Charge a 5% transaction fee and deposit the net amount (sales price less than the transaction fee) in stores bank account daily
• Gross profit is 40% of its sales revenue
• For the next several months the store wants to maintain an ending merchandise inventory equal to $11,000 + 25% of the next months cost of goods sold does. The September 30th inventory was $54,500.
• Expected monthly operating expenses include:

1. wages of store workers are $9,100 per month
2. Utility expenses of $12,000 in November and $2000 in December
3. property tax expenses of $2300 per month
4. property and liability insurance expense of $1000 per month
5. depreciation expense of $7500 for month
6. transaction fees as stated above R 5% of credit card and debit sales

Requirements: Prepare The following budgets for November and December

1. Sales budget
2. cost of goods sold, inventory, and purchases budget
3. operating expense budget
4. budget income statement

1. Prepare the sales budget for

November and December

.

Slattery Corner Shoppe
Sales Budget
For the Months of November and December
	November	December
Cash sales
Credit sales
Total sales

Requirement 2. Prepare the cost of goods sold, inventory, and purchases budget for

November and December

.

Slattery Corner Shoppe
Cost of Goods Sold, Inventory, and Purchases Budget
For the Months of November and December
	November	December
Cost of goods sold
Plus: Desired ending inventory
Total inventory required
Less: Beginning inventory
Purchases

Requirement 3. Prepare the operating expense budget for

November and December

.

Slattery Corner Shoppe
Operating Expenses Budget
For the Months of November and December
	November	December
Wage expense
Utilities expense
Property tax expense
Property and liability insurance expense
Depreciation expense
Credit/Debit card fees expense
Total operating expenses

Requirement 4. Prepare the budgeted income statement for

November

and

December

.

(Use the traditional format).

Slattery Corner Shoppe
Budgeted Income Statement
For the Months of November and December
	November	December
Sales revenue
Less: Cost of goods sold
Gross profit
Less: Operating expenses
Net income