Current Attempt in Progress Krause Industries balance sheet at December 31, 2019, is presented below. KRAUSE INDUSTRIES Balance Sheet December 31, 2019 Assets Current Assets Cash $7,500 Accounts receivable 73,500 Finished goods inventory (1,500 units) 24,530 Total current assets 105,530 Property, Plant, and Equipment Equipment $41.000 Less: Accumulated depreciation 10.960 30.040 Total assets $135.570 Liabilities and Stockholders' Equity Liabilities Notes payable $27,350 Accounts payable 45,170 Total liabilities 72,520 Stockholders' Equity Common stock $36,960 Retained earnings 26,090 Total stockholders' equity 63,050 Total liabilities and stockholders' equity $135,570 Budgeted data for the year 2020 include the following. 2020 Quarter 4 Total Sales budget (8,000 units at $32) $76,800 $256,000 Direct materials used 12,540 62,500 Direct labor 12,500 50,900 Manufacturing overhead applied 10,000 48,600 Selling and administrative expenses 15,120 75.000 To meet sales requirements and to have 2,500 units of finished goods on hand at December 31, 2020, the production budget shows 9,000 required units of output. The total unit cost of production is expected to be $18. Krause uses the first-in, first-out (FIFO) inventory costing method. Interest expense is expected to be $3,500 for the year. Income taxes are expected to be 40% of income before income taxes. In 2020, the company expects to declare and pay an $8,510 cash dividend. The company's cash budget shows an expected cash balance of $5,880 at December 31, 2020. All sales and purchases are on account. It is expected that 60% of quarterly sales are collected in cash within the quarter and the remainder is collected in the following quarter. Direct materials purchased from suppliers are paid 50% in the quarter incurred and the remainder in the following quarter. Purchases in the fourth quarter were the same as the materials used. In 2020. the company expects to purchase additional equipment costing $9,010. $3,228 of depreciation expense on equipment is included in the budget data and split equally between manufacturing overhead and selling and administrative expenses. Krause expects to pay $8.180 on the outstanding notes payable balance plus all interest due and payable to December 31 (included in interest expense $3.500 above). Accounts payable at additional equipmen between manufacturing overhead and selling and administrative expenses. Krause expects to pay $8,180 on the outstanding notes payable balance plus all interest due and payable to December 31 (included in interest expense $3,500, above). Accounts payable at December 31, 2020, includes amounts due suppliers (see above) plus other accounts payable relating to manufacturing overhead of $9,030. Unpaid income taxes at December 31 will be $6,830. (a) Prepare a budgeted statement of cost of goods sold. KRAUSE INDUSTRIES Budgeted Cost of Goods Sold (b) Prepare a budgeted multiple-step income statement for 2020. KRAUSE INDUSTRIES Budgeted Income Statement KRAUSE INDUSTRIES Budgeted Retained Earnings Statement