ACC 202 Milestone 3 Actual Costs and Revenue Data Appendix
ACC 202 Milestone Three: Actual Costs and Revenue Data Appendix
At the end of the first month of opening your business, you calculate the actual opera8ng costs of the business
and the income you earned. You also no8ce and document the difference in what you budgeted for certain
materials and labor against the actual amounts you spent on the same.
For your statement of cost of goods sold, use the following data regarding the actual costs incu
ed by the
usiness over the past month:
• Materials purchased: $20,000
o Consumed 80% of the purchased materials
• Direct labor: $8,493.33
• Overhead costs: $3,765
Note: Assume that the beginning materials and ending work in process are zero for the month.
Use the following revenue and cost informa8on for the income statement. Note that the revenue you use will
depend on the pricing level op8ons you chose in Milestone Two. Also, assume that aTer accoun8ng for
weekends and other holidays, there were 20 business days in the first month of opera8on. For example, if you
chose a sales price of $20 per collar, the actual number of collars sold in the month was 33 per day or 33 x 20 =
660 per month.
The other costs incu
ed by the business include:
• General and administra8ve salaries
o Recep8onist: $1,950
o Owner salary: $500
• Deprecia8on: $165
• Rent: $750
• U8li8es and insurance: $600
• Scissors, thread, and cording: $1,200
• Loan repayment: $550
Established Sales Price Number of Items Sold per Day
Collars
$20 33
$24 28
$28 23
Leashes
$22 28
$26 23
$30 18
Harnesses
$25 25
$30 22
$35 20
Variance
At the end of the month, you find that the labor and materials spent on manufacturing collars was different from
what you es8mated:
• The collar maker had to work nine hours a day instead of eight due to an increased demand for collars.
• Because of the increased demand, the hourly rate you paid your employee for making the collars
increased to $16.50.
• An increase in the cost of raw material led the direct material cost per collar to increase to $10.
• However, you also made and sold 60 more collars than you expected to sell in the month.
You now need to determine the variance in the materials and labor cost from what you es8mated in Milestone
Two based on the market research data.
ACC 202 Milestone Three: Actual Costs and Revenue Data Appendix
Variance
Milestone Three Guidelines and Ru
ic - ACC-202-H7120 Managerial Accounting 21EW1
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Scenario
It has now been one month since you launched your business. You are mee!ng with a few investors soon to share your vision for the
company and to ask for more funding. You will be sharing your company’s financial health at this mee!ng. To do that, you need to
determine and analyze your company’s performance over the last month using the data provided.
Prompt
Use the informa!on in the Milestone Three Actual Costs and Revenue Data Appendix Word Document to evaluate your company’s
performance, and complete the remaining tabs in the Project Workbook Spreadsheet that you used for the Milestone One and Two
assignments.
Specifically, you must address the following ru
ic criteria:
Statement of Cost of Goods Sold: Prepare the statement of cost of goods sold in the “COGS” tab of the workbook. Remembe
to show your work using calcula!ons to the side of the table or using appropriate formulas in the table.
Income Statement: Use the given revenue data to prepare the “Income Statement” tab table and calculate the net income.
Remember to show your work using calcula!ons to the side of the table or using appropriate formulas in the table.
Variance Analysis: Prepare the data in the “Variances” tab to determine whether the variances are favorable or unfavorable.
Remember to show your work using calcula!ons to the side of the table or using appropriate formulas in the table.
Complete the data table for the variances by entering the budgeted (standard) and actual labor and material values.
Remember to use the es!mates for expected sales from your Milestone Two assignment.
Determine the variances for direct labor and direct materials in the “Variances” tab.
Evaluate the significance of the variances in the “Variances” tab, and mark them as favorable or unfavorable.
Guidelines for Submission
Submit the Project Workbook with all tabs completed. This file should be completed and submi"ed using Microso# Excel.
Milestone Three Ru
ic
Criteria Exemplary (100%) Proficient (85%)
Needs Improvement
(55%)
Not Evident (0%) Value
Statement of Cost
of Goods Sold
Prepares the
statement of cost of
goods sold, with no
e
ors; shows work
through calcula!ons
or formulas
Prepares the
statement of cost of
goods sold, with
minimal e
ors
Prepares the
statement of cost of
goods sold, with
significant e
ors
Does not a"empt
criterion
35
Income Statement Prepares the income
statement and
calculates net
income, with no
e
ors; shows work
through calcula!ons
or formulas
Prepares the income
statement and
calculates net
income, with minimal
e
ors
Prepares the income
statement and
calculates net
income, with
significant e
ors
Does not a"empt
criterion
35
Variance Analysis: Completes the data Completes the data N/A Does not a"empt 10
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Data Table table for variances,
with no e
ors;
shows work through
calcula!ons o
formulas
table for variances,
with some e
ors
criterion
Variance Analysis:
Variances
Determines all
variances for both
direct labor and
direct materials;
shows work through
calcula!ons o
formulas
Determines most
variances for direct
labor and direct
materials
N/A Does not a"empt
criterion
10
Variance Analysis:
Significance
Co
ectly evaluates
all variances as
favorable o
unfavorable
Co
ectly evaluates
most variances as
favorable o
unfavorable
N/A Does not a"empt
criterion
10
Total: 100%
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
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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 DATA
Grooming:
Dog Grooming Arm - $300 .
Grooming Table - $900
Grooming Tub - $2,800
Clippers - $136.99; can be used for 100 grooms
Shampoo - $103.96 per 5-gallon pail; can be used for 100 grooms
Salon Tuff Capri Mobile Ca
y Cart - $90
Scissors (7 inch straight) - $194.99; used for 200 grooms
Scissors (ear and nose) - $7.49; used for 200 grooms
Day Care:
Fencing for Day Care area - $1,249
Fencing Installation - $1,000
Toys - $3.29 per 6 pack; one toy will last for two dogs in day care per day
Ru
erized Flooring for Day Care - $3,800
Boarding:
12 Kennels; Depreciation is $80 per month
General:
Food & Water bowls - $3.59 per unit
Day Care - two bowls last for every 75 dogs that attend daycare
Boarding - two bowls last for every 100 dogs boarded; two bowls per kennel
Grooming - each bowl lasts for 20 grooms and you need 4 bowls at all times
Towels - $34.99 per 12 pack
Day Care - 12 towels for every 25 dogs
Boarding - 12 towels for every 40 dogs
Grooming - 2 towels for every groom per day
Heating System - $10,000; Depreciation is $83 per month; Allocate based on square footage
Rent - $650 per month; Allocate based on square footage
Utilities / Insurance - $600 per month; Allocate based on square footage
Cage Bank - $2,200 per set of 5
Dryer - $1,250
Cleaning Products
Odoban - $14.55 per gallon; Each area wil dilute 1 oz to 1 gallon of water; Allocate based on square footage
Simple Green - $15.66 per gallon; Each area will dilute 1 oz to 1 gallon of water; Allocate based on square footage
.
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Cost Classification
Milestone One - Cost Classification
INSTRUCTIONS:
Putting an X in the appropriate spot, classify the costs as: Direct Material, Direct Labor, Overhead, or Period Costs.
The Fixed and Variable cost classifications have been provided for you.
Item/Cost Direct
Material Direct
Labor
Overhead Period Costs Fixed Variable
Salary - Collar maker x x
Salary - Leash maker x x
Salary - Harness maker x x
Salary - Receptionist x
High-tensile strength nylon we
ing x x
Polyeste
nylon ri
ons x x
Buckles made of cast hardware x x
Depreciation on sewing machines x x
Rent x x
Utilities and insurance x x
Scissors, thread, and cording x x
Price tags x x
Office supplies x x
Oter business equipment x x
Loan payment x x
Salary to self x x
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Variable and Fixed Costs
Milestone