3. Apple Company has completed all operating budgets other than the income statement for 2017. Selected...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
3. Apple Company has completed all operating budgets other than the income statement for 2017. Selected data from these budgets follow. Sales $240,000 Direct Labor $15,000 Purchase of raw materials $135,000 Manufacturing overhead (include depreciation expense $1,500) $33,000 Ending Inventory of raw materials $10,000 $31,000 Selling and administrative expenses (include depreciation expense $500) Dividends declared $2,000 Interest expense $1,000 Income tax rate 25% Principal payment on note $2,000 Assume that: The number of units produced equals the number sold. Year-end accounts receivable: 5% of 2017 sales. Year-end accounts payable: 50% of ending inventory of raw materials. Interest, direct labor, manufacturing overhead, and selling and administrative expenses other than depreciation and income tax are paid as incurred. Dividends declared and income taxes for 2017 will not be paid until 2018. Apple Company Balance Sheet December 31, 2016 Assets Current assets Cash $30,000 Raw materials inventory 15,000 Total current assets $45,000 Property, plant, and equipment Equipment $35,000 Less: accumulated depreciation 1,000 $34,000 Total assets $79,000 Liabilities and Stockholders' Equity Liabilities Accounts payable $6,000 Notes payable 22,000 Total liabilities $28,000 Stockholders' equity Common stock 23,000 Retained earnings 28,000 Total stockholders' equity 51,000 Total liabilities and stockholders' equity $79,000 Instructions (a) Prepare a budgeted income statement for the year Ending December 31, 2017. 1O Poin (b) Prepare a budgeted classified balance sheet as of December 31, 2017. 10 Poin 3. Apple Company has completed all operating budgets other than the income statement for 2017. Selected data from these budgets follow. Sales $240,000 Direct Labor $15,000 Purchase of raw materials $135,000 Manufacturing overhead (include depreciation expense $1,500) $33,000 Ending Inventory of raw materials $10,000 $31,000 Selling and administrative expenses (include depreciation expense $500) Dividends declared $2,000 Interest expense $1,000 Income tax rate 25% Principal payment on note $2,000 Assume that: The number of units produced equals the number sold. Year-end accounts receivable: 5% of 2017 sales. Year-end accounts payable: 50% of ending inventory of raw materials. Interest, direct labor, manufacturing overhead, and selling and administrative expenses other than depreciation and income tax are paid as incurred. Dividends declared and income taxes for 2017 will not be paid until 2018. Apple Company Balance Sheet December 31, 2016 Assets Current assets Cash $30,000 Raw materials inventory 15,000 Total current assets $45,000 Property, plant, and equipment Equipment $35,000 Less: accumulated depreciation 1,000 $34,000 Total assets $79,000 Liabilities and Stockholders' Equity Liabilities Accounts payable $6,000 Notes payable 22,000 Total liabilities $28,000 Stockholders' equity Common stock 23,000 Retained earnings 28,000 Total stockholders' equity 51,000 Total liabilities and stockholders' equity $79,000 Instructions (a) Prepare a budgeted income statement for the year Ending December 31, 2017. 1O Poin (b) Prepare a budgeted classified balance sheet as of December 31, 2017. 10 Poin
Expert Answer:
Answer rating: 100% (QA)
Cost of Goods Sold Direct Material Opening Stock 15000 Purchases 135000 Less Closing Stock 10000 Net ... View the full answer
Related Book For
Principles of Managerial Finance
ISBN: 978-0133507690
14th edition
Authors: Lawrence J. Gitman, Chad J. Zutter
Posted Date:
Students also viewed these accounting questions
-
E. Gevera Realty Co. who owns a building in the downtown area in Davao City was partly rented by Metro Drug Company 2,000 per month starting January 2002. Based on their lease contract agreement the...
-
Stephen's Shoes makes laces for their shoes. The following are the costs: DM $.15, DL $.20, MOH $.30 for a total of $.60 per pair of laces. Gray Company has offered to sell Stephen laces for $.40 per...
-
The income statement for the year ended December 31, 2015, the balance sheets for December 31, 2015 and 2014, and the statement of retained earnings for the year ended December 31, 2015, for...
-
Examine existing HRM practices in your company or one that you know about. Which of them are the product of your countrys legal, economic, political or social institutions? Provide explanations for...
-
What are the components of the attitude-toward-the-object model? What are the components of the theory of reasoned action?
-
What principles are you aware of that you would associate with green and sustainable finance?
-
List the various types of dynamometers.
-
City View Restaurant is about to open at a new location. Operating plans indicate the following expected cash flows: 1. Compute the NPV for all these cash flows. This should be a single amount. Use a...
-
Create a spreadsheet along the lines discussed above using the information given in problem 3-16 of your textbook. Verify whether your spreadsheet is correct by comparing the net income obtained in...
-
The following diagram represents a high-temperature reaction between CH4 and H2O. Based on this reaction, how many moles of each product can be obtained starting with 4.0 mol CH4?
-
What is the surface temperature of a thermally thin piece of cotton fabric that is 1.0 mm thick, has a density of 1500 kg/m3, a specific heat of 1.34 kJ/kgK, and a thermal conductivity of 0.04 W/mK...
-
Assume that the water utility, an enterprise fund, was billed $25,000 for data processing work during the year ended June 30, 20X7. What account in the enterprise fund should be debited to record...
-
At the end of 2011, Jose Reyes signed a sixyear contract to play shortstop for the Miami Marlins baseball team. (Reyes was later traded by the Marlins to the Toronto Blue Jays.) The contract was...
-
For the year ended June 30, 20X5, Stanton Townships enterprise funds reported an increase in net position of $300,000 and ending net position of $4,500,000 at June 30, 20X5. The enterprise fund also...
-
For the year ended June 30, 20X5, Stanton Townships internal service funds reported an increase in net position of $300,000 and ending net position of $4,500,000 at June 30, 20X5. On the...
-
Suppose that on January 1, 2013, the price of a one-year Treasury bill is $970.87. Investors expect that the inflation rate will be 2% during 2013, but at the end of the year, the inflation rate...
-
3 Determine how many terms of the following convergent series must be summed to be sure that the remainder is less than 10 in magnitude. (-1)* 00 k=0 2k+1 The number of terms that must be summed is...
-
When a company has a contract involving multiple performance obligations, how must the company recognize revenue?
-
Pro forma balance sheet Peabody & Peabody has 2015 sales of $10 million. It wishes to analyze expected performance and financing needs for 2017, which is 2 years ahead. Given the following...
-
Cash flow projections are a central component to the analysis of new investment ideas. In most firms, the person responsible for making these projections is not the same person who generated the...
-
Everdeen, Inc., has a 100-day operating cycle. If its average age of inventory is 35 days, how long is its average collection period? If its average payment period is 30 days, what is its cash...
-
Which form of financing allows the source of the funds to share in the wealth if the company which received the financing does well? a. A loan b. An investment c. Both a loan and an investment d....
-
Which form of financing requires repayment, regardless of whether the company receiving the funds does well or not? a. A loan b. An investment c. Both a loan and an investment d. Neither a loan nor...
-
What are vertical and horizontal financial statement analyses? What are their advantages?
Study smarter with the SolutionInn App