Answer the Following Questions Using the Information Below:
Sherry and John

question 53

Multiple Choice

Answer the following questions using the information below:
Sherry and John Enterprises are using the kaizen approach to budgeting for 2015. The budgeted income statement for January 2015 is as follows:
$$\begin{array} { l r } \text { Sales ( } 168,000 \text { units) } & \$ 1,000,000 \\\text { Less: Cost of goods sold } & 600,000 \\\text { Gross margin } & 400,000 \\\text { Operating expenses } & 300,000 \\\text { (includes } \$ 50,000 \text { of fixed costs) } & \\\text { Operating income } & \$ 100,000 \\\hline\end{array}$$ Under the kaizen approach, cost of goods sold and variable operating expenses are budgeted to decline by 1% per month.
-What is budgeted gross margin for March 2015?

• A) $392,040
• B) $396,000
• C) $408,040
• D) $411,940

---

Definitions:

Semantic Memory

A type of long-term memory involving the recall of general facts and knowledge about the world.

Spatial Orientation

An individual's ability to recognize themselves or objects in relation to environment, direction, and position in space.

Numeric Ability

The capacity to understand, manipulate, and interpret numbers and mathematical concepts.

Warner Schaie

An American psychologist known for his research on adult development and aging, particularly his work on the Seattle Longitudinal Study which investigates cognitive changes across the lifespan.