Chapter 24, Problem 2CP

To determine

Budgeted Income Statement, Budgeted Balance Sheet and Budgeted Cash flows:

After preparation of Operating budgets, the next step is to prepare the Budgeted income statement as the revenue has already been computed in sales budgets and various cost like cost of goods sold and selling and admin expense has already been computed under the respective budgets.

On the basis of income statement and various ending balances of operating assets and liabilities available from the operating budgets, the Budgeted Balance Sheet need to be prepared.

And as the Cash budget has already been prepared, the budgeted cash flows statement shall also be prepared dividing all the inflows and outflows in operating, investing and financing activities.

Requirement1:

The preparation of Budgeted Income Statement.

To determine

Requirement2:

The preparation of Budgeted Balance Sheet.

To determine

Requirement3:

The Budgeted Cash flow Statement shall be prepared.