Chapter 7, Problem 25QS

To determine

Budgeted Income Statement:

It is a financial report in which we record estimated earnings and expenses of business. It is prepared after operating budget. It consists of items of revenues, expense nature and net result of that period. It contains same items like of actual income statement.

Budgeted Balance Sheet:

It is a financial report which estimates the amount of assets, liabilities and equity. It is similar to normal balance sheet; the only difference is the budgeted balance sheet is based on projections.

To identify: Whether the item is of budgeted income statement or of budgeted balance sheet.