Johnson Company Has the Following Projected Account Balances for September

question 111

Essay

Johnson Company has the following projected account balances for September 30:
$\begin{array}{lrlr}\text { Accounts payable } & \$ 20,000 & \text { Sales } & \$ 400,000 \\\text { Accounts receivable } & 50,000 & \text { Capital stock } & 200,000 \\\text { Depreciation, factory } & 12,000 & \text { Retained earnings } & ? ? ? \\\text { Inventories }(8 / 31) & 90,000 & \text { Maintenance, factory } & 14,000 \\\text { Inventories }(9 / 30) & 90,000 & \text { Cash } & 28,000 \\\text { Materials used } & 100,000 & \text { Equipment, net } & 120,000 \\\text { Office expenses } & 40,000 & \text { Buildings, net } & 200,000 \\\text { Insurance, factory } & 2,000 & \text { Utilities, factory } & 8,000 \\\text { Factory wages } & 70,000 & \text { Selling expenses } & 30,000 \\\text { Bonds payable } & 80,000 & &\end{array}$

a.Prepare a budgeted income statement for September.
b.Prepare a budgeted balance sheet as of September 30.

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Definitions:

Equilibrium Quantity

The quantity of goods or services supplied and demanded at the equilibrium price, where the quantity supplied equals the quantity demanded.

Equilibrium Price

The price at which the quantity of a good or service demanded equals the quantity supplied, resulting in market balance and no excess supply or demand.

Equilibrium Quantity

The quantity of goods or services supplied equals the quantity demanded at the market equilibrium price.

Supply Curve

A graphical representation showing the relationship between the price of a good or service and the amount of it that producers are willing and able to supply at various prices.