Prepare a budgeted statement of cost of good sold

Prepare a budgeted multiple-step income statement for 2020

Krause Industries' balance sheet at December 31, 2019, is presented below. $7,500 73,500 26,620 107,620 $40,130 10,620 KRAUSE INDUSTRIES Balance Sheet December 31, 2019 Assets Current Assets Cash Accounts receivable Finished goods inventory (1,500 units) Total current assets Property, Plant, and Equipment Equipment Less: Accumulated depreciation Total assets Liabilities and Stockholders' Equity Liabilities Notes payable Accounts payable Total liabilities Stockholders' Equity Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity 29,510 $137,130 $27,060 45,370 72,430 $38,750 25,950 64,700 $137,130 Budgeted data for the year 2020 include the following. Sales budget (8,000 units at $32) Direct materials used Direct labor Manufacturing overhead applied Selling and administrative expenses 2020 Quarter 4 Total $76,800 $256,000 13,000 62,500 12,500 50,900 10,000 48,600 15,670 75,000 To meet sales requirements and to have 2,500 units of finished goods on hand at December 31, 2020, the production budge 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 $10,700 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 $9,860. $6,882 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 $9,780 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 $8,870. Unpaid income taxes at December 31 will be $7,110