Fortune, Inc., is preparing its master budget for the first quarter. The company sells a single product at a price of $25 per unit. Sales (in units) are forecasted at 42,000 for January, 62,000 for February, and 52,000 for March. Cost of goods sold is $12 per unit. Other expense information for the first quarter follows.
- Commissions 11 % of sales
- Rent $ 18,000 per month
- Advertising 12 % of sales
- Office salaries $ 78,000 per month
- Depreciation $ 47,000 per month
- Interest 11 % annually on a $260,000 note payable
- Tax rate 30 %