As a preliminary to requesting budget estimates of sales, costs, and expenses for the fiscal year beginning January 1, 2

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As a preliminary to requesting budget estimates of
sales, costs, and expenses for the fiscal year beginning January 1,
20Y9, the following tentative trial balance as of December 31,
20Y8, is prepared by the Accounting Department of Regina Soap
Co.:
Factory output and sales for 20Y9 are expected to total 23,000
units of product, which are to be sold at $100 per unit. The
quantities and costs of the inventories at December 31, 20Y9, 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:
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
$195,200 on 20Y9 taxable income will be paid during 20Y9. Regular
quarterly cash dividends of $1 per share are expected to be
declared and paid in March, June, September, and December on 30,000
shares of common stock outstanding. It is anticipated that fixed
assets will be purchased for $124,000 cash in May.
Required:
Question Content Area
1. Prepare a budgeted income statement
for 20Y9.
Gross profitIncome before income taxInterest expenseInterest
revenueSales
Direct materialsIncome tax expenseMiscellaneous selling
expenseOffice and officers salariesSupplies
Direct laborGross profitIncome tax expenseMiscellaneous
administrative expenseSales
AdvertisingFactory overheadIncome tax expenseSales salaries and
commissionsSales
Income tax expenseNet lossSales salaries and
commissionsSalesSupplies
AdvertisingDirect laborDirect materialsFactory overheadNet
loss
Gross profitIncome tax expenseMiscellaneous selling
expenseSalesSupplies
AdvertisingIncome tax expenseOffice and officers salariesSales
salaries and commissionsSales
AdvertisingDirect materialsFactory overheadNet lossSupplies
Gross profitIncome tax expenseMiscellaneous administrative
expenseMiscellaneous selling expenseSales
AdvertisingDirect materialsFactory overheadIncome tax
expenseSupplies
Gross profitNet incomeNet loss
Question Content Area
2. Prepare a budgeted balance sheet as of
December 31, 20Y9.
Accounts payableCashCommon stockMaterialsPlant and equipment
Accounts payableAccounts receivablePlant and equipmentRetained
earningsWork in process
Accumulated depreciationCashCommon stockFinished goodsPlant and
equipment
Accounts payableCashPlant and equipmentPrepaid expensesWork in
process
Accounts payableCashCommon stockMaterialsPlant and equipment
Accounts payablePlant and equipmentPrepaid expensesRetained
earningsWork in process
Accounts receivableCashCommon stockMaterialsPlant and
equipment
Accounts payableAccumulated depreciationPrepaid expensesRetained
earningsWork in process
Accounts payableCashCommon stockMaterialsPlant and equipment
Accounts payableAccumulated depreciationCommon stockPlant and
equipmentPrepaid expenses
Accumulated depreciationCashPlant and equipmentPrepaid
expensesRetained earnings
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