The management of Mecca Copy, a photocopying center located on University Avenue, has compiled the following data to use in preparing its budgeted balance sheet for next year: Ending Balances Cash ? Accounts receivable $ 9,700 Supplies inventory $ 3,800 Equipment $ 42,000 Accumulated depreciation $ 17,000 Accounts payable $ 3,400 Common stock $ 5,000 Retained earnings ? The beginning balance of retained earnings was $33,000, net income is budgeted to be $16,900, and dividends are budgeted to be $3,500. Required: Prepare the company’s budgeted balance sheet. (Amounts to be deducted should be indicated by a minus sign.)
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
The management of Mecca Copy, a photocopying center located on University Avenue, has compiled the following data to use in preparing its budgeted
|
|
Ending Balances |
|
Cash |
? |
|
|
$ 9,700 |
|
Supplies inventory |
$ 3,800 |
|
Equipment |
$ 42,000 |
|
|
$ 17,000 |
|
Accounts payable |
$ 3,400 |
|
Common stock |
$ 5,000 |
|
|
? |
The beginning balance of retained earnings was $33,000, net income is budgeted to be $16,900, and dividends are budgeted to be $3,500.
Required:
Prepare the company’s budgeted balance sheet. (Amounts to be deducted should be indicated by a minus sign.)
![**Mecca Copy Budgeted Balance Sheet**
---
### Assets
#### Current Assets:
- [Blank]
- [Blank]
- [Blank]
- [Blank]
- [Blank]
**Total Current Assets**
- [Blank]
#### Plant and Equipment:
- [Blank]
- [Blank]
- [Blank]
**Plant and Equipment, Net**
- [Blank]
**Total Assets**
- [Blank]
---
### Liabilities and Stockholders' Equity
#### Current Liabilities:
- [Blank]
#### Stockholders' Equity:
- [Blank]
- [Blank]
- [Blank]
- [Blank]
**Total Stockholders' Equity**
- [Blank]
**Total Liabilities and Stockholders' Equity**
- [Blank]
---
### Explanation of the Balance Sheet Components:
1. **Current Assets:**
This section includes assets that are expected to be converted to cash or used up within a year. Examples typically include cash, accounts receivable, and inventory.
2. **Plant and Equipment:**
This section comprises long-term assets that are used in the operations of the business, like machinery, buildings, and land.
3. **Current Liabilities:**
These are obligations the company expects to settle within a year, such as accounts payable and short-term loans.
4. **Stockholders' Equity:**
This section represents the owners’ claim on the company’s assets after all liabilities have been deducted. It may include common stock, retained earnings, and additional paid-in capital.
This balance sheet provides a snapshot of the financial condition of Mecca Copy at a given point in time, showing what the company owns (assets) and owes (liabilities), along with the shareholders' equity.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F78d7be80-233f-42fa-8c01-70bc4da57dc5%2F632f5343-9702-48e9-ad81-1335adb6f38f%2Fdsi7hya_processed.jpeg&w=3840&q=75)
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
