Part D!

Problem 23-6A (Part Level Submission) Krause Industries' balance sheet at December 31, 2016, is presented below. KRAUSE INDUSTRIES Balance Sheet December 31, 2016 Assets Current Assets Cash $7,500 73,500 Accounts receivable Finished goods inventory (1,500 units) 25,460 Total current assets 106,460 Property, Plant, and Equipment $40,580 Equipment Less: Accumulated depreciation 10,230 30,350 $136,810 Total assets Liabilities and Stockholders' Equity Liabilities Notes payable $27,580 Accounts payable 45,500 73,080 Total liabilities Stockholders' Equity $36,240 Common stock Retained earnings 27,490 Total stockholders' equity 63,730 $136,810 Total liabilities and stockholders' equity Budgeted data for the year 2017 include the following 2017 Tota uarter 4. Sales budget (8,000 units at $32) $76,800 $256,000 Direct materials used 62,500 12,010 12,500 50,900 Direct labor Manufacturing overhead applied 10,000 48,800 75,000 Selling and administrative expenses 17,040 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 $9,620 cash dividend The company's 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 n 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 $11,890. $10,741 of depreciation expense on equipment is included in the bud t dat betw d ad th t d cts t tst