CALCULATOR PRINTER VERSION BACK NEXT Problem 21-6A (Part Level Submission) Krause Industries' balance sheet at December 31, 2016, is presented below. KRAUSE INDUSTRIES Balance Sheet December 31, 2016 Assets Current Assets Cash Accounts receivable Finished goods inventory (1,500 units) Total current assets Property. Plant, and Equipment Equipment $40,240 Les Accumulated depreciation 10,510 Total Liabilities and Stockholders' Equity $7,500 73,500 25,170 106,170 29,730 $135,900 $25,240 45,120 70,360 Notes le Accounts payable Tallibilities Stockholders' Equity Commen stock Rendering Total stockholde equity Total liabilities and stock qully $38,080 27,460 65,540 $135,900 Budgeted data for the year 2017 include the following 2017 Quarter 4 Total Sales budget (8,000 units at $32) $76,800 $256,000 Direct materials used 11,790 62,500 Direct labor 12,500 50,900 Manufacturing overhead applied 10,000 49,820 Selling and administrative expenses 15,060 25.000 CALCULATOR PRINTER VERSION 4 BACK NEXT To meet sales requirements and to have 2,500 units of finished goods on hand at December 31, 2017, the production budget 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 2017, the company expects to declare and pay an $10,560 cash dividend. The company's cash budget shows an expected cash balance of $5,880 at December 31, 2017. 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 2017, the company expects to purchase additional equipment costing $10,530. $10,949 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 $10,070 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, 2017, includes amounts due suppliers (see above) plus other accounts payable of $9,240. Unpaid income taxes at December 31 will be $5,160. Your answer is correct Prepare a budgeted statement of cost of goods sold. KRAUSE INDUSTRIES Budgeted Cost of Goods Sold For the Year Ending December 31, 2017 Finished Goods Inventory, 1/1/17 251701 Cost of Goods Manufactured Direct Materials Used 62500 Direct Labor 50900 Manufacturing Overhead Applied 49820 163220 Cost of Goods Available For Sale 188390 Finished Goods Inventory, 12/31/17 (45000) Cost of Goods Sold 143390 Click if you would like to Show Work for this question: Open Show Work (b) Prepare a budgeted multiple-step income statement for 2017. KRAUSE INDUSTRIES Budgeted Income Statement For the Year Ending December 31, 2017 Sales Revenue 256000 143390 Cost of Goods Sold Gross Profit 112610 Selling and Administrative Expenses 75000 Income from Operations Interest Expense 3500 Income before Income Taxes Income Tax Expense Net Income / (LOSS) Click if you would like to show Work for this question: Open Show Work LINK TO TEXT LINK TO TEXT Attemptsi 0 of 3 used