Answer the Following Questions Using the Information Below

Multiple Choice

Answer the following questions using the information below:
Sherry and John Enterprises are using the kaizen approach to budgeting for 2011. The budgeted income statement for January 2011 is as follows:
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 2011?

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