Question

As a preliminary to requesting budget estimates of sales, costs, and expenses for the fiscal year beginning January 1, 2009, the following tentative trial balance as of December 31, 2008, is prepared by the Accounting Department of Cornerstone Publishing Co.:


As a preliminary to requesting budget estimates of sales, costs, and expenses for the fiscal year beginning January 1, 2009, the following tentative trial balance as of December 31, 2008, is prepared by the Accounting Department of Cornerstone Publishing Co.:


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 $350,000 on 2009 taxable income will be paid during 2009. Regular quarterly cash dividends of $1.75 a share are expected to be declared and paid in March, June, September, and December. It is anticipated that fixed assets will be purchased for $180,000 cash in May.

Instructions
1. Prepare a budgeted income statement for 2009.
2. Prepare a budgeted balance sheet as of December 31, 2009, with supportingcalculations.


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  • CreatedJuly 17, 2012
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