Vaughn Industries' balance sheet at December 31,2024 , is presented below. Prepare a retained earnings statement for 2025 . (List items that increase retained carnings first.) VAUGHN INDUSTRIES Budgeted Retained Earnings Statement Selling and Administrative Expenses Retained Earnings. 12/31/25 Interest Expense Income from Operations Retained Earnings, 1/1/25 Dividends Income Tax Expense Income before income Taxes Sales Revenue Cost of Goods Sold Net Income/ (Loss) Gross Profit $ Budgeted data for the year 2025 include the following. To meet sales requirements and to have 3,100 units of finished goods on hand at December 31,2025, the production budget shows 11,160 required units of output. The total unit cost of production is expected to be $18. Vaughn uses the first-in, first-out (FIFO) inventory costing method. Interest expense is expected to be \$4,340 for the year. Income taxes are expected to be 20% of income before income taxes. In 2025 , the company expects to declare and pay an $9,920 cash dividend. The company's cash budzet shows an expected cash balance of \$35.712 at December 31, 2025. 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 2025, the company expects to purchase additional equipment costing \$11,160. A total of \$5,180 of depreciation expense on equipment is included in the budget data and split equally between manufacturing overhead and selling and administrative expenses, Vaughn expects to pay $9,920 on the outstanding notes payable balance plus all interest due and payable to December 31 (included in interest expense $4,340, above). Accounts payable at December 31,2025 , includes amounts due suppliers (see above) plus other accounts payable relating to manufacturing overhead of $8,928. Unpaid income taxes at December 31 will be $6,200. Vaughn Industries' balance sheet at December 31,2024 , is presented below. Prepare a retained earnings statement for 2025 . (List items that increase retained carnings first.) VAUGHN INDUSTRIES Budgeted Retained Earnings Statement Selling and Administrative Expenses Retained Earnings. 12/31/25 Interest Expense Income from Operations Retained Earnings, 1/1/25 Dividends Income Tax Expense Income before income Taxes Sales Revenue Cost of Goods Sold Net Income/ (Loss) Gross Profit $ Budgeted data for the year 2025 include the following. To meet sales requirements and to have 3,100 units of finished goods on hand at December 31,2025, the production budget shows 11,160 required units of output. The total unit cost of production is expected to be $18. Vaughn uses the first-in, first-out (FIFO) inventory costing method. Interest expense is expected to be \$4,340 for the year. Income taxes are expected to be 20% of income before income taxes. In 2025 , the company expects to declare and pay an $9,920 cash dividend. The company's cash budzet shows an expected cash balance of \$35.712 at December 31, 2025. 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 2025, the company expects to purchase additional equipment costing \$11,160. A total of \$5,180 of depreciation expense on equipment is included in the budget data and split equally between manufacturing overhead and selling and administrative expenses, Vaughn expects to pay $9,920 on the outstanding notes payable balance plus all interest due and payable to December 31 (included in interest expense $4,340, above). Accounts payable at December 31,2025 , includes amounts due suppliers (see above) plus other accounts payable relating to manufacturing overhead of $8,928. Unpaid income taxes at December 31 will be $6,200
