Noventis Corporation prepared the following estimates for the
four quarters of the current year:
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Sales
$
1,425,000
$
1,710,000
$
1,995,000
$
2,280,000
Cost of goods...
80.2K
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Finance
Noventis Corporation prepared the following estimates for thefour quarters of the current year:
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
Sales
$
1,425,000
$
1,710,000
$
1,995,000
$
2,280,000
Cost of goods sold
446,000
526,000
596,000
646,000
Administrative costs
440,000
250,000
255,000
265,000
Advertising costs
0
120,000
0
0
Executive bonuses
0
0
0
80,000
Provision for bad debts
0
0
0
90,000
Annual maintenance costs
66,000
0
0
0
Additional Information
First-quarter administrative costs include the $180,000 annualinsurance premium.
Advertising costs paid in the second quarter relate totelevision advertisements that will be broadcast throughout theentire year.
No special items affect income during the year.
Noventis estimates an effective income tax rate for the year of40 percent.
Assuming that actual results do not vary from theestimates provided, determine the amount of net income to bereported each quarter of the current year.
Assume that actual results do not vary from theestimates provided except for that in the third quarter, theestimated annual effective income tax rate is revised downward to38 percent. Determine the amount of net income to be reported eachquarter of the current year.
1
1st Qtr
2nd Qtr
3rd Qtr
4th Qtr
2
1st Qtr
2nd Qtr
3rd Qtr
4th Qtr
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