Russell Company has the following projected account balances for June 30, 2011:
Required:
a. Prepare a budgeted income statement for June 2011
b. Prepare a budgeted balance sheet as of June 30, 2011.
Definitions:
Cost Center
A department or unit within an organization that does not directly add to profit but still incurs costs.
Departmental Contribution To Overhead
The amount of money that each department contributes towards covering the company's indirect costs or overheads.
Profit Center
A segment or division within a company that is responsible for generating its own revenue and profit, tracked separately for performance analysis.
Responsibility Accounting System
A system of accounting that tracks financial performance and costs at the level of individual responsibility centers, encouraging managerial accountability.
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