1) The _________________ basis of estimating uncollectibles normally results in the
best approximation of _______________ value and therefore emphasizes balance sheet
relationships.
2) The process of transferring net income (or loss) for the period to Owner’s Capital is
accomplished by making ______________ entries.
3) An unrealized gain or loss on available-for-sale securities is reported as a separate
component of _________________.
4) A major difference between the income statements of a merchandising company and
a manufacturing company is that the cost of goods sold section of a merchandising
company shows cost of goods______________, whereas a manufacturing company
shows cost of goods ______________.
5) Budgeting and long-range planning are both important aids to management in
achieving a company’s goals and objectives. Briefly distinguish between budgeting and
long-range planning and indicate how they help managers perform their functions.
6) Metropolitan Symphony sells 200 season tickets for $100,000 that represents a five
concert season. The amount of Unearned Ticket Revenue after the second concert is
$40,000.
7) A major disadvantage of the partnership form of organization is ______________,
which makes each partner personally and individually liable for all partnership
liabilities.
8) Assets that do not have a physical substance yet often are very valuable are called
______________ assets.
9) Trenton Company has budgeted the following unit sales:
20142015
Quarter UnitsQuarter Units
1140,0001125,000
280,000
3100,000
4160,000
The finished goods inventory on hand on December 31, 2013 was 28,000 units. It is the
company’s policy to maintain a finished goods inventory at the end of each quarter
equal to 20% of the next quarter’s anticipated sales.
Instructions
Prepare a production budget for 2014 .
