Answer the Following Question(s) Using the Information Below

Answer the following question(s) using the information below.
Sherry and John Enterprises are using the Kaizen approach to budgeting for 2016. The budgeted income statement for January 2016 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 2016?

A) $392,040
B) $396,000
C) $408,040
D) $411,940
E) $412,000