PR $22-6$A Budgeted income statement and balance sheetAs a preliminary to requesting budget estimates of sales, costs, and expenses for the fiscal yearbeginning January $1,20$Y$9,$ the Fallowing tentative trial balance as of December $31,20$Y$8,$ is prepared by the Accounting Departmest of Regina Soap Co$.$Cash $$85,000$Accouns Receivable $125,000$ Finished Goods $69,300$Work in Process $32,500$Materials $48,900$Prepaid Expenses $2,600$Plant and Equipment $325,000$Accumulated Depreciation $-$plant and equipment $156,200$Accounts Payable $62,000$Common Stock, $$10$ par $180,000$Retained Earnings $290,700$$$688,900$Factory output and sales for $20$Y$9$ are expected to total $200,000$ units of product, which are to be sold at $$5\mathrm{.}00$ per unit. The quantities and cost of the inventories at Decembez $31,20$Y$9,$ are expected to remain unchanged from the balances at the beginning de the year.Budget estimates of manulacturing costs and operating expenses for the year are summarized as follow'sEstimated Costs and ExpensesFixed$($Total for year$)$Variable $($per unit sold$)$Cost of goods marifactured and sold:Direct materials$$1\mathrm{.}10$Direct labor$\mathrm{.}0\mathrm{.}65$Factory overhead:Depreciation of plant and equipment $40,000$Other factory overhead$\mathrm{.}12,0000\mathrm{.}40$Selling expenses:Sales salaries and commissions$\mathrm{.}46,0000\mathrm{.}45$Advertising$64,000$Miscellaneous selling expense$6,0000\mathrm{.}25$Adiministrative expenses:Office and officers salaries$72,4000\mathrm{.}12$Supplies$5,0000\mathrm{.}10$Miscellaneous administration expanse$-4,0000\mathrm{.}05$Balances of accounts receivable, prepaid expenses, and accounts payable at the end of the year are not expected to differ significantly from the beginning balances. Federal income tax of $$30,000$ on $20$Y$9$ taxable income will be paid during $20$Y$9.$ Regular quarterly cash dividends of $$0\mathrm{.}15$ per share are expected to be declared and paid in March, June, September, and December on $18,000$ shares of common stock outstanding. It is anticipated that fixed assets will be purchased for $$75,000$ cash in MayInstructions$1.$ Prepare a budgeted income statement for $20$Y$9\mathrm{.}2.$ Prepare a budgeted balance sheet as of December $31,20$Y$9,$ with supporting calculations.