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The goal of the project is to demonstrate the application of the three main sections learned in your Managerial Accounting course, which are: 1.Cost Accounting Systems (Ch 14-17) 3.Budgeting &...

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ACCT 1B - MANAGERIAL ACCOUNTING PROJECT
ACCT 1B - MANAGERIAL ACCOUNTING PROJECT
    The goal of the project is to demonstrate the application of the three main sections learned in your Managerial Accounting course, which are:
1. Cost Accounting Systems (Ch 14-17)
2. Cost, Volume, & Profit Analysis (Ch 18-20)
3. Budgeting & Planning (Ch 21-24)
To demonstrate the concepts, you will prepare a manufacturing proposal of a single product with all related tables, analysis and budgets on a multi-tab, formulated, and interconnected Excel worksheet, which includes the following tabs and content in each tab:
Tab #1 – Cost Accounting (30 points)
Introduction to Product
    Write a
ief introduction about your product, and how much you would sell it for.
COMPANY NAME?
Product Costs
    
    OZ. PER WHOLE PIZZA
    COST PER PIZZA
    FLOUR
    4oz.
    $0.77
    CHEESE
    7oz.
    $2.01
    TOMATO
    8oz.
    $1.75
    PEPPERONI
    3oz.
    $1.07
    VEGGIES
    2oz.
    $0.40
****WHOLE PIZZA TOTAL $6.00****
Table 1:
Direct Material costs (per unit)
    DIRECT MATERIALS
    TOTAL # OF UNITS PER MONTH
    COST PER UNIT
    
    FLOUR
    200
    $5
    1,000
    CHEESE
    100
    $3
    300
    TOMATO
    150
    $2
    300
    PEPPERONI
    100
    $8
    800
    VEGGIES
    100
    $7
    700
    PIZZA BOX
    500
    $1
    500
    TOTAL
    
    
    3,600
TOTAL= 1150 UNITS
Table 2: Direct Labor costs (per hour)
    
    HOURS
    RATE
    ASSEMBLY
    2HRS.
    $20.00
    MACHINE/OVEN
    1HR.
    $10.00
Table 3: Manufacturing Overhead costs
    
    INDIRECT MATERIALS
    TOTAL COST PER MONTH
    WATER
    $5
    SALT
    $3
    SUGAR
    $5
    YEAST
    $5
    OIL
    $5
    CARDBOARD
    $1
    
    
    INDIRECT LABOR;
    
    MANAGER SALARY
    $3,000
    DELIEVERY GUY SALARY
    $250
    BUILDING RENT
    $1,500
    ULTITIES EXPENSE
    $1,000
    INSURANCE EXPENSE
    $476
    PACKAGING EXPENSE
    $500
    PROPERTY TAXES
    $200
    DEPRECIATION
    $50
    
    
    TOTAL OVERHEAD EXPENSES
    $7,000
    
    
Table 4; Period Costs
    EXPENSE
    COSTS
    SELLING EXPENSE
    $2,000
    ADVERTISING EXPENSE
    $150
    DELIEVERY EXPENSE
    $250
    
    
    TOTAL PERIOD COST
    $2,400
OUR COMPANY ESTIMATES THAT ANNUAL MANUFACTURING OVERHEAD COST WILL BE $500,000. ESTIMATED ANNUAL OPERATING ACTIVITY BASE IS $25,000 LABOR COSTS. PREDETERMINED OVERHEAD RATE= ESTIMATED OVERHEAD/ESTIMATED LABOR COST $500,000/$25,000=20%
Cost Flow Entries
Assuming in the first month of operation, you started production of 1,000 units of your product, completed 800 units, and sold 600 units, record all entries required to move costs from Tables 1, 2, and 3 to Work-In-Process, then to Finished Goods, then to Cost of Goods Sold (You can set your own Sales Price)
Note: In allocating Manufacturing Overhead to WIP, you need to use an overhead rate using an estimated base (either labor cost, labor hours, or machine hours)
Income Statement
Prepare the first month’s Income Statement based on the 600 units sold, zero beginning inventory balances, and Period Costs from Table 4.
NET INCOME: $
Tab #2 CVP Analysis (30 points)
Cost Types
Table 1: Variable Costs – classify costs from Tab #1 into Variable group
    FLOUR
    CHEESE
    TOMATO
    PEPPERONI
    VEGGIES
    PIZZA BOX 3,600
    ASSEMBLY
    MACHINE/OVEN
    WATER
    SALT
    SUGAR
    YEAST
    OIL
    Table 2: Fixed Costs – classify costs from Tab #1 into Fixed group
    
    
    
    
    
    CARDBOARD
    MANAGER SALARY
    DELIEVERY GUY SALARY
    BUILDING RENT
    ULTITIES EXPENSE
    INSURANCE EXPENSE
    PACKAGING EXPENSE
    PROPERTY TAXES
    DEPRECIATION
    Note: If any mixed costs, you need to split into fixed and variable groups
CVP Income Statement
Prepare a CVP Income Statement using Variable and Fixed cost groups (CVP Net Income should match to the Net Income in Tab #1)
COMPANY NAME
CVP Income Statement
For the Month Ended March 31, 2020
                    Total            
Sales (9,500 pizzas) $57,000
Variable costs -$9,600 (3,600+6,000; DIRECT MATERIALS & DIRECT LABOR
Contribution margin $47,400
Fixed costs         -$7,000
Net income         $40,400
Contribution Margin
    Compute the Contribution Margin per Unit and Contribution Margin Ratio
UNIT CONTRIBUTION MARGIN:
$6-
CONTRIBUTION MARGIN RATIO:
$ /$6
Break-Even Analysis
    Compute the Break-Even point in Units and in Sales Dollars
Target Net-Income
Compute Target Net-Income for a desired income you would want to see above the first month’s Net Income computed in Tab #1
Tab #3 Budgets & Planning (40 points)
Master Budget
Prepare the Master Budget for the next four (4) Quarters, which includes the following budgets:
· Sales Budget
· Production Budget
· Direct Materials Budget
· Direct Labor Budget
· Manufacturing Overhead Budget
· Selling & Administrative Expense Budget
· Cash Budget
· Budgeted Income Statement
Your final spreadsheet should have 3 tabs (total 100 points), and attached in a reply to your Group Discussion post titled “Managerial Project”.
Answered Same Day May 26, 2021

Solution

Neenisha answered on May 31 2021
153 Votes
Tab 1
    Table 1: Direct Materials Cost (per unit)            Table 2: Direct Labor (per hour)            Table 3: Manufacturing Overhead Costs            Table 4: Period Costs
    Description/Qty    Cost Per Unit         Description    Hourly Rate        Description    Monthly Cost        Description    Monthly Cost
    Flour (15 oz)    $0.50        Assembly    $13.00        Indirect Material    $24        Selling Expense    $1,000
    Cheese (10 oz)    $0.75        Machine    $12.00        Manager Salary    $3,000        Advertising Expense    $50
    Tomato (5 oz)    $0.50        Total Cost    $25.00        Delivery Guy Salary    $250        Delivery Expense    $100
    Pepperoni (10 oz)    $0.75                    Plant Rent    $1,500        Total Cost    $1,150
    Veggies (10 oz)    $0.75                    Utilities Expense    $1,000
    Pizza Box (20 oz)    $0.80                    Insurance Expense    $476
    Total Cost    $4.05                    Packaging Expense    $500
                            Property Taxes    $200
    Direct Material Used Per Unit                        Plant Depreciation    $50
    70    oz                    Total Cost    $7,000
    Overhead Cost
    Estimated Annual Overhead Cost    $84,000
    Annual Operating Base (Labour Hours)    12000
    Predetermined Annual Overhead Rate    $7.00
    Details
    Total Unit    1000
    Completed Units    800
    WIP    200
    Sold    600
    Labour Hours Per Product    0.05    (Since Total units produced required are 225000 and 12000 labour hours are used on annual bases)
    Selling Price    $6
    Work In Progress            Finished Goods
        200            800
    Direct Material Cost    $810        Direct Material Cost    $3,240
    Direct Labour Cost    $250        Direct Labour Cost    $1,000
    Total Direct Cost    $1,060        Total Direct Cost    $4,240
    Manufacturing Overhead Cost    $70        Manufacturing Overhead Cost    $280
    Total    $1,130        Total    $4,520
     PizzaCo...
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