Krause Industries balance sheet at December 31, 2016, is presented below.

KRAUSE INDUSTRIES Balance Sheet December 31, 2016
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 2017 include the following.

		2017
		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		50,940
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, 2017, 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 2017, the company expects to declare and pay an $8,510 cash dividend. The companys cash budget shows an expected cash balance of $5,880 at December 31, 2017. 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 2017, the company expects to purchase additional equipment costing $9,010. $4,632 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 December 31, 2017, includes amounts due suppliers (see above) plus other accounts payable of $9,030. Unpaid income taxes at December 31 will be $6,830.

1.Prepare a budgeted statement of cost of goods sold.

2. Prepare a budgeted balance sheet at December 31, 2013