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, 20Y9, the following tentative trial balance as of December 31, 20Y8, is prepared by the Accounting Department of Regina Soap Co.:

Cash	$101,300
Accounts Receivable	190,400
Finished Goods	40,000
Work in Process	26,700
Materials	43,800
Prepaid Expenses	3,200
Plant and Equipment	514,600
Accumulated DepreciationPlant and Equipment			$221,300
Accounts Payable			155,500
Common Stock, $10 par			300,000
Retained Earnings			243,200
	$920,000		$920,000

Factory output and sales for 20Y9 are expected to total 25,000 units of product, which are to be sold at $120 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:

	Estimated Costs and Expenses
	Fixed (Total for Year)		Variable (Per Unit Sold)
Cost of goods manufactured and sold:
Direct materials	_		$30
Direct labor	_		9.5
Factory overhead:
Depreciation of plant and equipment	$25,000		_
Other factory overhead	7,800		5.5
Selling expenses:
Sales salaries and commissions	89,800		15
Advertising	75,000		_
Miscellaneous selling expense	6,500		2.5
Administrative expenses:
Office and officers salaries	59,000		7.5
Supplies	3,000		1
Miscellaneous administrative expense	1,600		2

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 $272,200 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 $139,000 cash in May.

Required:

1. Prepare a budgeted income statement for 20Y9.

Regina Soap Co.
Budgeted Income Statement
For the Year Ending December 31, 20Y9
Sales			$fill in the blank 81f7aaf98fd7fbc_2
Cost of goods sold:
Direct materials		$fill in the blank 81f7aaf98fd7fbc_4
Direct labor		fill in the blank 81f7aaf98fd7fbc_6
Factory overhead		fill in the blank 81f7aaf98fd7fbc_8
Cost of goods sold			fill in the blank 81f7aaf98fd7fbc_9
Gross profit			$fill in the blank 81f7aaf98fd7fbc_10
Operating expenses:
Selling expenses:
Sales salaries and commissions	$fill in the blank 81f7aaf98fd7fbc_12
Advertising	fill in the blank 81f7aaf98fd7fbc_14
Miscellaneous selling expense	fill in the blank 81f7aaf98fd7fbc_16
Total selling expenses		$fill in the blank 81f7aaf98fd7fbc_17
Administrative expenses:
Office and officers salaries	$fill in the blank 81f7aaf98fd7fbc_19
Supplies	fill in the blank 81f7aaf98fd7fbc_21
Miscellaneous administrative expense	fill in the blank 81f7aaf98fd7fbc_23
Total administrative expenses		fill in the blank 81f7aaf98fd7fbc_24
Total operating expenses			fill in the blank 81f7aaf98fd7fbc_25
Income before income tax			$fill in the blank 81f7aaf98fd7fbc_26
Income tax expense			fill in the blank 81f7aaf98fd7fbc_28
Net income			$fill in the blank 81f7aaf98fd7fbc_30

2. Prepare a budgeted balance sheet as of December 31, 20Y9.

Regina Soap Co. Budgeted Balance Sheet December 31, 20Y9
Assets
Current assets:
Cash		$fill in the blank a7c21afe0fdf008_2
Accounts receivable		fill in the blank a7c21afe0fdf008_4
Inventories:
Finished goods	$fill in the blank a7c21afe0fdf008_6
Work in process	fill in the blank a7c21afe0fdf008_8
Materials	fill in the blank a7c21afe0fdf008_10	fill in the blank a7c21afe0fdf008_11
Prepaid expenses		fill in the blank a7c21afe0fdf008_13
Total current assets			$fill in the blank a7c21afe0fdf008_14
Property, plant, and equipment:
Plant and equipment		$fill in the blank a7c21afe0fdf008_16
Accumulated depreciation		fill in the blank a7c21afe0fdf008_18
Total property, plant, and equipment			fill in the blank a7c21afe0fdf008_19
Total assets			$fill in the blank a7c21afe0fdf008_20
Liabilities
Current liabilities:
Accounts payable			$fill in the blank a7c21afe0fdf008_22
Stockholders' Equity
Common stock		$fill in the blank a7c21afe0fdf008_24
Retained earnings		fill in the blank a7c21afe0fdf008_26
Total stockholders equity			fill in the blank a7c21afe0fdf008_27
Total liabilities and stockholders equity			$fill in the blank a7c21afe0fdf008_28