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Budgeted Income Statement and Balance Sheet

As a preliminary to requesting budget estimates of sales, costs, and expenses for the fiscal year beginning January 1, 2015, the following tentative trial balance as of December 31, 2014, is prepared by the Accounting Department of Webster Publishing Co.:

Cash	$110,500
Accounts Receivable	195,600
Finished Goods	41,100
Work in Process	27,400
Materials	45,000
Prepaid Expenses	3,300
Plant and Equipment	498,400
Accumulated DepreciationPlant and Equipment			$214,300
Accounts Payable			158,700
Common Stock, $10 par			300,000
Retained Earnings			248,300
	$921,300		$921,300

Factory output and sales for 2015 are expected to total 25,000 units of product, which are to be sold at $90 per unit. The quantities and costs of the inventories at December 31, 2015, are expected to remain unchanged from the balances at the beginning of the year.

Budget estimates of manufacturing costs and operating expenses for the year are summarized as follows:

	Estimated Costs and Expenses
	Fixed (Total for Year)		Variable (Per Unit Sold)
Cost of goods manufactured and sold:
Direct materials	_		$23.00
Direct labor	_		7.00
Factory overhead:
Depreciation of plant and equipment	$25,000		_
Other factory overhead	7,800		4.00
Selling expenses:
Sales salaries and commissions	89,800		11.50
Advertising	75,000		_
Miscellaneous selling expense	6,500		2.00
Administrative expenses:
Office and officers salaries	59,000		5.50
Supplies	3,000		1.00
Miscellaneous administrative expense	1,600		1.50

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 $178,400 on 2015 taxable income will be paid during 2015. Regular quarterly cash dividends of $1.00 per share are expected to be declared and paid in March, June, September, and December on 30,000 shares of common stock outstanding. It is anticipated that fixed assets will be purchased for $135,000 cash in May.

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Deadline 1Hr 45 Min from now

1. Prepare a budgeted income statement for 2015 Webster Publishing Co. Budgeted Income Statement For the Year Ending December 31,2015 Cost of goods sold: Cost of goods sold Gross profit Operating expenses: Selling expenses Total selling expenses

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