At the end of the first month of opening your business, you calculate the actual operating...
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At the end of the first month of opening your business, you calculate the actual operating costs of the business and the income you earned. You also notice 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 incurred by the business over the past month: Materials purchased: $20,000 Consumed 80% of the purchased materials Direct labor: $8,493 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 information for the income statement. Note that the revenue you use will depend on the pricing level options you chose in Milestone Two. Also, assume that after accounting for weekends and other holidays, there were 20 business days in the first month of operation. 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. Established Sales Number of Items Sold per Price Collars $20 524 28 $28 23 Leashes: $22 28 $26 23 $30 18 Harnesses $25 25 $30 $35 20 28 22 Day 6:13 PM Mon Feb 5 82% learn.snhu.edu $24 28 $28 23 Leashes $22 28 $26 23 $30 18 228 Harnesses $25 25 $30 $35 20 222 The other costs incurred by the business include: General and administrative salaries Receptionist: $1,950 Office supplies: $200 Other business equipment: $150 Variance At the end of the month, you find that the labor and materials spent on manufacturing collars was different from what you estimated: 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 expected to sell in the month. you You now need to determine the variance in the materials and labor cost from what you estimated in Milestone Two based on the market research data. 1 1 2 Milestone Three - Income Statement 3 4 5 Revenue: 6 Collars 7 Leashes 8 Harnesses 9 10 Total Revenue: 11 Cost of goods sold 12 Gross profit 13 14 Expenses: 15 General and administrative salaries 16 Office supplies 17 Other business equipment 18 19 Total Expenses 20 21 Net Income/Loss 22 23 24 26 27 $ $ At the end of the first month of opening your business, you calculate the actual operating costs of the business and the income you earned. You also notice 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 incurred by the business over the past month: Materials purchased: $20,000 Consumed 80% of the purchased materials Direct labor: $8,493 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 information for the income statement. Note that the revenue you use will depend on the pricing level options you chose in Milestone Two. Also, assume that after accounting for weekends and other holidays, there were 20 business days in the first month of operation. 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. Established Sales Number of Items Sold per Price Collars $20 524 28 $28 23 Leashes: $22 28 $26 23 $30 18 Harnesses $25 25 $30 $35 20 28 22 Day 6:13 PM Mon Feb 5 82% learn.snhu.edu $24 28 $28 23 Leashes $22 28 $26 23 $30 18 228 Harnesses $25 25 $30 $35 20 222 The other costs incurred by the business include: General and administrative salaries Receptionist: $1,950 Office supplies: $200 Other business equipment: $150 Variance At the end of the month, you find that the labor and materials spent on manufacturing collars was different from what you estimated: 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 expected to sell in the month. you You now need to determine the variance in the materials and labor cost from what you estimated in Milestone Two based on the market research data. 1 1 2 Milestone Three - Income Statement 3 4 5 Revenue: 6 Collars 7 Leashes 8 Harnesses 9 10 Total Revenue: 11 Cost of goods sold 12 Gross profit 13 14 Expenses: 15 General and administrative salaries 16 Office supplies 17 Other business equipment 18 19 Total Expenses 20 21 Net Income/Loss 22 23 24 26 27 $ $
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Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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