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Question - January budgeted selling and administrative expenses for the retail shoe store that Craig Shea plans to open on January 1, year 1, are as follows: sales commissions, $26,500; rent, $17,000; utilities, $4,700; depreciation, $3,200; and miscellaneous, $2,800. Utilities are paid in the month after they are incurred. Other expenses are expected to be paid in cash in the month in which they are incurred.
Required -
a. Determine the amount of budgeted cash payments for January selling and administrative expenses.
b. Determine the amount of utilities payable the store will report on the January 31 proforma balance sheet.
c. Determine the amount of depreciation expense the store will report on the income statement for year 1, assuming that monthly depreciation remains the same for the entire year.
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