Budgeted sales for the month of April are shown in the following table: SalesAprilMayJuneCash Sales $1,050 Sales on Account $1,350 The company expects a 10% increase in sales per month for May and June. The amount of sales revenues that would appear on the company's 2nd quarter pro forma income statement would be Multiple Choice
A) $7,944.00
B) $7,213.25
C) $4,468.50
D) $2,904.00
To calculate the sales revenues for May and June, we need to multiply the sales for April by the expected increase of 10% for each month:
May sales = $1,050 + ($1,050 * 0.10) = $1,050 + $105 = $1,155
June sales = $1,155 + ($1,155 * 0.10) = $1,155 + $115.50 = $1,270.50
The total sales revenues for the second quarter would be:
April sales + May sales + June sales = $1,050 + $1,155 + $1,270.50 = $3,475.50
Therefore, the correct answer is D) $2,904.00.
To calculate the sales revenues for the second quarter pro forma income statement, we need to calculate the sales for May and June, and then add them to the April sales.
Given:
April sales: Cash Sales $1,050 + Sales on Account $1,350 = $2,400
May sales: 10% increase from April sales: $2,400 * 10% = $240
May sales = $2,400 + $240 = $2,640
June sales: 10% increase from May sales: $2,640 * 10% = $264
June sales = $2,640 + $264 = $2,904
Total sales for the second quarter: April sales $2,400 + May sales $2,640 + June sales $2,904 = $7,944.00
Therefore, the correct answer is A) $7,944.00.