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Overview Successful entrepreneurs understand all aspects of business, especially costs and costing systems. In the course project, you will assume the role of the owner of a small business and apply...

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Overview

Successful entrepreneurs understand all aspects of business, especially costs and costing systems. In the course project, you will assume the role of the owner of a small business and apply managerial accounting principles to evaluate and manage costs related to your services within a costing system. In the first milestone of the project, you will determine and classify the costs necessary for opening your business.

Scenario

You plan to open a business manufacturing collars, leashes, and harnesses for pets. To begin, you will manufacture these in a standard style and size with plans to expand your range over the year. In a few weeks, you will present your company’s financial strategy to some key investors. To begin creating your strategy, you need to consider and record all the costs associated with operating your business. You have decided to use the job order costing system.

Prompt

Use the given operational costs in theMilestone One Operational Costs Data Appendixdocument to complete the first two tabs, “Cost Classification” and “Variable and Fixed Costs,” in theProject Workbook.

Specifically, you must address the following rubric criteria:

  • Cost Classification.Accurately classify all your costs in the “Cost Classification” tab of your workbook.
    • Identify direct material, direct labor, overhead, and period costs. (Note: Fixed and variable costs have been classified for you.)
  • Variable and Fixed Costs.Complete the “Variable and Fixed Costs” tab of your workbook. (Note: Some costs are provided for you. Fill in only the missing costs.)
    • Determine your total variable cost per unit and the total fixed costs for each product. Show your work using calculations to the side of the table or using appropriate formulas in the table.

Guidelines for Submission

Submit the Project Workbook with the “Cost Classification” and “Fixed and Variable Costs” tabs completed. This file should be completed and submitted using Microsoft Excel.


Answered 3 days After May 11, 2021

Solution

Khushboo answered on May 14 2021
154 Votes
Instructions
    Southern New Hampshire University
    College of Continuing Education (COCE)
    ACC202 - Managerial Accounting
    MILESTONE 1 (Due in Module 2)                MILESTONE 2 (Due in Module 4)                    MILESTONE 3 (Due in Module 5)
    1.                    1.                    1.
        Name                    Choose a price range and calculate:                    Create a Cost of Goods Manufactured Schedule
        Location                    Grooming
        Vision                    Day Care
        Mission                    Boarding
    2.                    2.                    2.
        Identify the following:                    Calculate the
eak-even units                    Create an Income Statement
        Direct Materials                    Grooming                    Revenue will be provided end of week 4
        Diret Labor                    Day Care
        Manufacturing Overhead                    Boarding
        Period Costs                    Calculate the
eak-even for target profits
    3.                        Grooming                3.
                            Day Care
        Calculate the Variable & Fixed Costs for:                    Boarding                    Calculate for the Grooming line:
        Grooming                                        Direct Labor Time Variance
        Day Care                                        Direct Labor Rate Variance
        Boarding                                        Direct Materials Efficiency Variance
                                                Direct Materials Price Variance
ACC202 - MANAGERIAL ACCOUNTING    
Company Profile
xl/drawings/drawing1.xml#CompanyProfileVariable & Fixed Costs
xl/drawings/drawing1.xml#VariableFixedCostsCost Classification
xl/drawings/drawing1.xml#CostClassificationContribution Margin
xl/drawings/drawing1.xml#ContributionMarginBreak-Even Analysis
xl/drawings/drawing1.xml#BreakevenAnalysisCOGM Schedule
xl/drawings/drawing1.xml#COGMScheduleIncome Statement
xl/drawings/drawing1.xml#COGMScheduleVariances
xl/drawings/drawing1.xml#VariancesInstructions Milestone 1
xl/drawings/drawing1.xml#InstructionsMilestone1Instructions Milestone 2
xl/drawings/drawing1.xml#'Instructions%20-%20Milestone%202'!InstructionsMilestone2Instructions Milestone 3
xl/drawings/drawing1.xml#'Instructions%20-%20Milestone%203'!InstructionsMilestone3
Instructions - Milestone 1
    Southern New Hampshire University
    College of Continuing Education (COCE)
    ACC202 - Managerial Accounting
    INSTRUCTIONS FOR MILESTONE 1 (Due Week 2)
    IMPORTANT NOTE:
    Make sure to completely review the Ru
ic for Milestone 1
    Use the data from this Milestone and begin working on your final presentation due in Milestone 4 (Week 7)
    ITEMS TO COMPLETE FOR THIS MILESTONE (Blue Tabs):
    GENERAL
    You plan to open a pet services business that will offer dog grooming, day care and boarding
    COST CLASSIFICATION
    Accurately classify all of your costs (direct material, direct labor, manufacturing overhead, period costs)
    Fixed & Variable cost designation is provided
    VARIABLE & FIXED COSTS
    Determine your per unit cost per dog for grooming, day care and boarding
    OPERATIONAL & COST INFORMATION:
    For simplicity, base all calculations using 30 days in each month
    OPERATIONAL DATA
    Grooming:
    The Groomer can groom 5 dogs a day, 5 days a week
    Each grooming takes 1.5 labor hours
    Day Care:
    The Day Care can house 10 large dogs and 12 small dogs daily.
    Day Care is offered 6 days a week
    Boarding:
    There are 12 kennels (single dog only).
    Boarding (kennel services) is offered every day
    Facilities:
    The Grooming facility is 200 square feet
    The Boarding facility is 2,500 square feet
    The Day Care facility is 1,500 square feet
    General:
    Loan for start-up costs - monthly payment of $420; in effect immediately; limited cash and loan funding - used angel investors
    Modest monthly draw of $600 a month for first year; should be divided evenly amoung the services (grooming, day care, boarding)
    SALARY & HIRING DATA
    Groomer (Allison) - $12.00 an hour, 40 hours a week
    Day Care Attendant (Beverly) - $9.00 per hour, based on need
    Receptionist (Cathie) - $8.50 per hour, 30 hours a week
    Kennel Attendant (Ben) - $11.50 per hour, based on need
    OTHER COST...
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