Budgeted Income Statement and Balance Sheet As a preliminary to requesting budget estimates of sales, costs, and expenses for the fiscal year beginning January 1, 20Y4, the following tentative trial balance as of December 31, 20Y3, is prepared by the Accounting Department of Regina Soap Co.: Cash $105,400 Accounts Receivable 206,600 Finished Goods 43,400 Work in Process 28,900 Materials 47,500 Prepaid Expenses 3,500 Plant and Equipment 474,300 Accumulated Depreciation—Plant and Equipment $203,900 Accounts Payable 138,700 Common Stock, $10 par 350,000 Retained Earnings 217,000 $909,600 $909,600 Factory output and sales for 20Y4 are expected to total 25,000 units of product, which are to be sold at $110 per unit. The quantities and costs of the inventories at December 31, 20Y4, are expected to remain unchanged from the balances at the beginning of the year. Budget estimates of manufacturing costs and operating expenses for the year are summarized as follows: Estimated Costs and Expenses Fixed (Total for Year) Variable (Per Unit Sold) Cost of goods manufactured and sold: Direct materials _ $28 Direct labor _ 8.5 Factory overhead: Depreciation of plant and equipment $25,000 _ Other factory overhead 7,800 5 Selling expenses: Sales salaries and commissions 89,800 14 Advertising 75,000 _ Miscellaneous selling expense 6,500 2 Administrative expenses: Office and officers salaries 59,000 7 Supplies 3,000 1 Miscellaneous administrative expense 1,600 1.5 Balances of accounts receivable, prepaid expenses, and accounts payable at the end of the year are not expected to differ significantly from the beginning balances. Federal income tax of $242,200 on 20Y4 taxable income will be paid during 20Y4. Regular quarterly cash dividends of $1 per share are expected to be declared and paid in March, June, September, and December on 35,000 shares of common stock outstanding. It is anticipated that fixed assets will be purchased for $128,000 cash in May. Required: Question Content Area 1. Prepare a budgeted income statement for 20Y4. Regina Soap Co.Budgeted Income StatementFor the Year Ending December 31, 20Y4 $- Select - Cost of goods sold: $- Select - - Select - - Select - Cost of goods sold fill in the blank 29632cffd048f93_9 Gross profit $fill in the blank 29632cffd048f93_10 Operating expenses: Selling expenses: $- Select - - Select - - Select - Total selling expenses $fill in the blank 29632cffd048f93_17 Administrative expenses: $- Select - - Select - - Select - Total administrative expenses fill in the blank 29632cffd048f93_24 Total operating expenses fill in the blank 29632cffd048f93_25 Income before income tax $fill in the blank 29632cffd048f93_26 - Select - $- Select - Question Content Area 2. Prepare a budgeted balance sheet as of December 31, 20Y4. Regina Soap Co. Budgeted Balance Sheet December 31, 20Y4 Assets Current assets: $fill in the blank 61b2c301607803b_2 fill in the blank 61b2c301607803b_4 Inventories: $fill in the blank 61b2c301607803b_6 fill in the blank 61b2c301607803b_8 fill in the blank 61b2c301607803b_10 fill in the blank 61b2c301607803b_11 fill in the blank 61b2c301607803b_13 Total current assets fill in the blank 61b2c301607803b_14 Property, plant, and equipment: $fill in the blank 61b2c301607803b_16 fill in the blank 61b2c301607803b_18 fill in the blank 61b2c301607803b_19 Total assets $fill in the blank 61b2c301607803b_20 Liabilities Current liabilities: $fill in the blank 61b2c301607803b_22 Stockholders' Equity $fill in the blank 61b2c301607803b_24 fill in the blank 61b2c301607803b_26 Total stockholders’ equity fill in the blank 61b2c301607803b_27 Total liabilities and stockholders’ equity $fill in the blank 61b2c301607803b_28

Budgeted Income Statement and Balance Sheet As a preliminary to requesting budget estimates of sales, costs, and expenses for the fiscal year beginning January 1, 20Y4, the following tentative trial balance as of December 31, 20Y3, is prepared by the Accounting Department of Regina Soap Co.: Cash $105,400 Accounts Receivable 206,600 Finished Goods 43,400 Work in Process 28,900 Materials 47,500 Prepaid Expenses 3,500 Plant and Equipment 474,300 Accumulated Depreciation—Plant and Equipment $203,900 Accounts Payable 138,700 Common Stock, $10 par 350,000 Retained Earnings 217,000 $909,600 $909,600 Factory output and sales for 20Y4 are expected to total 25,000 units of product, which are to be sold at $110 per unit. The quantities and costs of the inventories at December 31, 20Y4, are expected to remain unchanged from the balances at the beginning of the year. Budget estimates of manufacturing costs and operating expenses for the year are summarized as follows: Estimated Costs and Expenses Fixed (Total for Year) Variable (Per Unit Sold) Cost of goods manufactured and sold: Direct materials _ $28 Direct labor _ 8.5 Factory overhead: Depreciation of plant and equipment $25,000 _ Other factory overhead 7,800 5 Selling expenses: Sales salaries and commissions 89,800 14 Advertising 75,000 _ Miscellaneous selling expense 6,500 2 Administrative expenses: Office and officers salaries 59,000 7 Supplies 3,000 1 Miscellaneous administrative expense 1,600 1.5 Balances of accounts receivable, prepaid expenses, and accounts payable at the end of the year are not expected to differ significantly from the beginning balances. Federal income tax of $242,200 on 20Y4 taxable income will be paid during 20Y4. Regular quarterly cash dividends of $1 per share are expected to be declared and paid in March, June, September, and December on 35,000 shares of common stock outstanding. It is anticipated that fixed assets will be purchased for $128,000 cash in May. Required: Question Content Area 1. Prepare a budgeted income statement for 20Y4. Regina Soap Co.Budgeted Income StatementFor the Year Ending December 31, 20Y4 $- Select - Cost of goods sold: $- Select - - Select - - Select - Cost of goods sold fill in the blank 29632cffd048f93_9 Gross profit $fill in the blank 29632cffd048f93_10 Operating expenses: Selling expenses: $- Select - - Select - - Select - Total selling expenses $fill in the blank 29632cffd048f93_17 Administrative expenses: $- Select - - Select - - Select - Total administrative expenses fill in the blank 29632cffd048f93_24 Total operating expenses fill in the blank 29632cffd048f93_25 Income before income tax $fill in the blank 29632cffd048f93_26 - Select - $- Select - Question Content Area 2. Prepare a budgeted balance sheet as of December 31, 20Y4. Regina Soap Co. Budgeted Balance Sheet December 31, 20Y4 Assets Current assets: $fill in the blank 61b2c301607803b_2 fill in the blank 61b2c301607803b_4 Inventories: $fill in the blank 61b2c301607803b_6 fill in the blank 61b2c301607803b_8 fill in the blank 61b2c301607803b_10 fill in the blank 61b2c301607803b_11 fill in the blank 61b2c301607803b_13 Total current assets fill in the blank 61b2c301607803b_14 Property, plant, and equipment: $fill in the blank 61b2c301607803b_16 fill in the blank 61b2c301607803b_18 fill in the blank 61b2c301607803b_19 Total assets $fill in the blank 61b2c301607803b_20 Liabilities Current liabilities: $fill in the blank 61b2c301607803b_22 Stockholders' Equity $fill in the blank 61b2c301607803b_24 fill in the blank 61b2c301607803b_26 Total stockholders’ equity fill in the blank 61b2c301607803b_27 Total liabilities and stockholders’ equity $fill in the blank 61b2c301607803b_28

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question Content Area

1. Prepare a budgeted income statement for 20Y4.

Regina Soap Co.Budgeted Income StatementFor the Year Ending December 31, 20Y4

			$- Select -
Cost of goods sold:
		$- Select -
		- Select -
		- Select -
Cost of goods sold			fill in the blank 29632cffd048f93_9
Gross profit			$fill in the blank 29632cffd048f93_10
Operating expenses:
Selling expenses:
	$- Select -
	- Select -
	- Select -
Total selling expenses		$fill in the blank 29632cffd048f93_17
Administrative expenses:
	$- Select -
	- Select -
	- Select -
Total administrative expenses		fill in the blank 29632cffd048f93_24
Total operating expenses			fill in the blank 29632cffd048f93_25
Income before income tax			$fill in the blank 29632cffd048f93_26
			- Select -
			$- Select -

Question Content Area

2. Prepare a budgeted balance sheet as of December 31, 20Y4.

Regina Soap Co. Budgeted Balance Sheet December 31, 20Y4
Assets
Current assets:
		$fill in the blank 61b2c301607803b_2
		fill in the blank 61b2c301607803b_4
Inventories:
	$fill in the blank 61b2c301607803b_6
	fill in the blank 61b2c301607803b_8
	fill in the blank 61b2c301607803b_10	fill in the blank 61b2c301607803b_11
		fill in the blank 61b2c301607803b_13
Total current assets			fill in the blank 61b2c301607803b_14
Property, plant, and equipment:
		$fill in the blank 61b2c301607803b_16
		fill in the blank 61b2c301607803b_18	fill in the blank 61b2c301607803b_19
Total assets			$fill in the blank 61b2c301607803b_20
Liabilities
Current liabilities:
			$fill in the blank 61b2c301607803b_22
Stockholders' Equity
		$fill in the blank 61b2c301607803b_24
		fill in the blank 61b2c301607803b_26
Total stockholders’ equity			fill in the blank 61b2c301607803b_27
Total liabilities and stockholders’ equity			$fill in the blank 61b2c301607803b_28

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Cash	$105,400
Accounts Receivable	206,600
Finished Goods	43,400
Work in Process	28,900
Materials	47,500
Prepaid Expenses	3,500
Plant and Equipment	474,300
Accumulated Depreciation—Plant and Equipment		$203,900
Accounts Payable		138,700
Common Stock, $10 par		350,000
Retained Earnings		217,000
	$909,600	$909,600

	Estimated Costs and Expenses
	Fixed (Total for Year)	Variable (Per Unit Sold)
Cost of goods manufactured and sold:
Direct materials	_		$28
Direct labor	_		8.5
Factory overhead:
Depreciation of plant and equipment	$25,000		_
Other factory overhead	7,800		5
Selling expenses:
Sales salaries and commissions	89,800		14
Advertising	75,000		_
Miscellaneous selling expense	6,500		2
Administrative expenses:
Office and officers salaries	59,000		7
Supplies	3,000		1
Miscellaneous administrative expense	1,600		1.5