Panther Corporation appeared to be experiencing a good year. Sales in the first quarter were one-third ahead of last year, and the sales department predicted that this rate would continue throughout the entire year. The controller asked Janet Nomura, a summer accounting Intern, to prepare a draft forecast for the year and to analyze the differences from last year's results. She based the forecast on actual results obtained in the first quarter plus the expected costs of production to be completed in the remainder of the year. She worked with various department heads (production, sales, and so on) to get the necessary Information. The results of these efforts follow: Cash PANTHER CORPORATION Expected Account Balances for December 31, Year 2 Accounts receivable Inventory (January 1, Year 2) Plant and equipment Accumulated depreciation Accounts payable Notes payable (due within one year) Accrued payables Common stock Retained earnings sales revenue other income Manufacturing costs Materials Direct labor Depreciation $ 6,500 337,000 240,000 605,000 $ 181,000 197,000 217,000 110,000 450,000 468,000 2,570,000 70,000 850, eee 900,000 Variable overhead 545,000 37,000 other fixed overhead 48,000 Marketing Commissions 140,000 Salaries 81,000 Promotion and advertising 284,000 Administrative Salaries 81,000 Travel 18,500 office costs 53,000 Income taxes Dividends 37,000 $ 4,263,000 $4,263,000 Adjustments for the change in Inventory and for Income taxes have not been made. The scheduled production for this year is 350,000 units, and planned sales volume is 300,000 units. Sales and production volume was 200,000 units last year. The company uses a full- absorption costing and FIFO Inventory system and is subject to a 40 percent income tax rate. The actual Income statement for last year follows: Revenues PANTHER CORPORATION Statement of Income and Retained Earnings For the Budget Year Ended December 31, Year 1 Sales revenue other income Expenses Cost of goods sold Materials Direct labor Variable overhead Fixed overhead Beginning inventory $ 420,000 500,000 215,000 65,000 $ 1,200,000 240,000 $ 1,440,000 240,000 $ 1,700,000 55,000 $1,755,000 Ending inventory $ 1,200,000 Selling Salaries $ 71,000 Commissions 77,000 Promotion and advertising 143,000 291,000 General and administrative Salaries $ 73,000 Travel 17,000 office costs 49,000 139,000 Income taxes Operating profit 50,000 1,680,000 75,000 Beginning retained earnings Subtotal Less dividends Ending retained earnings Required: Prepared a budgeted Income statement and balance sheet. 430,000 $ 505,000 37,000 $ 468,000 Prepared a budgeted income statement. (Round "Cost per unit" to 2 decimal places. Do not round any other intermediate calculations.) PANTHER CORPORATION Budgeted Income Statement For the Year Ended December 31, Year 2 Revenue: Sales revenue Other income Total Revenue Expenses: Cost of goods manufactured & sold: Materials Direct labor Variable overhead Fixed overhead Beginning inventory Ending inventory Marketing: Salaries Commissions Promotions and advertising Administrative: Salaries Travel Office costs Income taxes (credit) Total expenses Operating profit (loss) Budgeted Inc Stmt Budgeted Balance Sheet Prepared a budgeted balance sheet. (Round "Cost per unit" to 2 decimal places. Do not round any other intermediate calculations.) Current Assets Total current assets Total assets Current liabilities Total current liabilities Shareholders' equity PANTHER CORPORATION Budgeted Balance Sheet Budgeted December 31, Year 2 Total shareholders' equity Total liabilities and shareholders' equity