Question

Carson Company has the following post-closing trial balance on December 31, 2016:
The company’s accounting department has gathered the following budgeting information for the first quarter of 2017:
Budgeted total sales, all on account .............$ 181,500
Budgeted direct materials to be purchased and used ...... 36,350
Budgeted direct labor cost ................ 25,560
Budgeted manufacturing overhead costs:
Variable manufacturing overhead ............. 1,775
Depreciation ...................... 1,200
Insurance and property taxes .............. 2,350
Budgeted cost of goods sold.............. 69,175
Budgeted selling and administrative expenses:
Salaries expense ................... 7,000
Rent expense ..................... 2,000
Insurance expense ................... 1,600
Depreciation expense ................. 100
Supplies expense .................... 1,815
Budgeted cash receipts from customers ........... 175,875
Budgeted income tax expense ............... 44,000
Budgeted purchase and payment for capital expenditures
(additional equipment) ................. 38,000
Additional information:
a. Direct materials purchases are paid 60% in the quarter purchased and 40% in the next quarter.
b. Direct labor, manufacturing overhead, selling and administrative costs, and income tax expense are paid in the quarter incurred.
Requirements
1. Prepare Carson Company’s budgeted income statement for the first quarter of 2017.
2. Prepare Carson Company’s budgeted balance sheet as of March 31, 2017.
3. Prepare Carson Company’s budgeted statement of cash flows for the first quarter of 2017.


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  • CreatedJune 15, 2015
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