Accounting Unit VII Final Paper

See attached word document, previous assignment and example templates

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Unit VII Final Project

Cookie Business Final Project

Now that your cookie business is well underway, you are going to use the knowledge that you have gained in this course to evaluate the financial information for the company. You will be creating a series of reports and analyzing the results using the templates provided to guide you through the project.

The learning objectives of this project are as follows:

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1. Apply accounting concepts and standards to the creation of accounting information and reports. 2. Analyze accounting information used to make strategic business decisions.
3. Apply ethical behavior to accounting-related situations.
4. Make business decisions based on analyzing accounting data.

Using the Unit VII Final Project Template, prepare a four- to five-page written report (including spreadsheets) with at least three scholarly sources. Your report will provide the following information:

Introduction
Part 1: Based on the data presented in the Unit VII Spreadsheet Template in Excel (CM Breakeven tab):

Calculate the contribution margin (CM) for each of the three products sold at the cookie business. Calculate the weighted average CM.
Calculate the breakeven point.

Complete your calculations by filling in the highlighted cells, and embed a copy of the completed spreadsheet into this report. Discuss the results based on your calculations as far as which type of cookie you think is the most profitable, which has the highest CM, etc.

Part 2: Based on the data presented in the Unit VII Spreadsheet Template in Excel (Full Variable tab), complete the calculations listed below.

Calculate the value of ending inventory under full or absorption costing. Calculate the value of ending inventory under variable costing.

Complete your calculations by filling in the highlighted cells, and embed a copy of the completed spreadsheet into this report. Discuss the results, and comment on which method you think is more helpful to managers and why.

Part 3: Based on the data presented in the Unit VII Spreadsheet Template in Excel (Special Order tab), calculate the net increase or decrease in profit if they take the special order.

Complete your calculations by filling in the highlighted cells, and embed a copy of the completed spreadsheet into this report. Discuss the results and comment on if you think the cookie business should take on this special order of cookies for a wedding. Business has been slow the last few months, and the offer is less than the usual selling price for the cookies.

As part of your discussion, include both quantitative (based on the numbers) and qualitative (not based on numbers) factors that would go into the decision to take on the special order.

Part 4: Based on the data presented in the Unit VII Spreadsheet Template in Excel (IRR tab), calculate the internal rate of return (IRR) for the new equipment purchase.

Complete your calculations by filling in the highlighted cells, and embed a copy of the completed spreadsheet into this report. Note: the PV Annuity table is provided for you. Discuss if you think the cookie business should accept or reject the purchase of the new equipment and why.

Additional information has come to your attention regarding the equipment purchase. One of the partner’s brother owns the company that sells the equipment and insists the equipment is needed. Discuss any ethical concerns you see with this type of transaction.

Part 5: Based on the data presented in the Unit VII Spreadsheet Template in Excel (Cash Budget tab), calculate the cash receipts for the first quarter of this year.

Complete your calculations by filling in the highlighted cells, and embed a copy of the completed spreadsheet into this report. Discuss your observations about the way cash is collected if the company needs $150,000 per month for expenses.

Part 6: Based on the data presented in the Unit VII Spreadsheet Template in Excel (Variances tab), complete the following calculations.

Calculate the material variances. Calculate the labor variances.

Complete your calculations by filling in the highlighted cells, and embed a copy of the completed spreadsheet into this report. Discuss your observations about the variances and ways to plan to improve any of the variances.

Conclusion and Recommendations

Summarize the key observations that you have made about the cookie business based on the calculations you have performed, and present any future recommendations.

Be sure to use APA formatting throughout, and reach out to the Writing Center or the Library for assistance with research, writing, and formatting. Include at least two resources from the CSU Online Library in your report.

1

5

Title of the Paper Goes Here

Student Name

Institution

ACC 5301 Management Applications of Accounting

Instructor

Date

Abstract

The abstract
is an overview of the paper, written after completion. Other researchers use the abstract to determine if your work will be useful to them. The abstract should include the background, hypothesis or research question, methodology for data collection and analysis, the findings of your research, and conclusions. It should be between 100–150 words. This is done when the paper is complete.

Title of Paper

Remember this part of the paper is double spaced in APA format.

The Introduction should lead readers into the topic and its importance. Introductions typically include the overall topic of the paper, the specific focus of the paper within the larger topic, the main points in the paper, the kind of paper (study, argument, critique, discussion), and the purpose.

Writing tip: The length of the introduction should be in proportion to the length of the paper. Also ask yourself, “With my purpose and my audience, how do I engage my readers best?” In the introduction, you set the tone of the piece, establish your voice, and demonstrate your writing style; be authentic to your purpose and your audience.

Part 1 Contribution Margin/Breakeven

Embed your spreadsheet for this section here and discuss the results.

Part 2 Full and Variable Costing

Embed your spreadsheet for this section here and discuss the results.

Part 3 Special Order

Embed your spreadsheet for this section here and discuss the results.

Part 4 Internal Rate of Return

Embed your spreadsheet for this section here and discuss the results.

Part 5 Cash Budget

Embed your spreadsheet for this section here and discuss the results.

Part 6 Material and Labor Variance

Embed your spreadsheet for this section here and discuss the results.

Conclusions and Recommendations

The conclusion
section should summarize for the readers the topics of importance that led to your final conclusions/analysis regarding this case. Include some specific areas of focus from your analysis to reinforce your conclusion.

References

Include complete references in proper APA format for all of the citations listed in your paper. Be sure to use the library for the required number of sources. Additional sources can be used but should be scholarly. Present your references in alphabetical order.

Sheet1

units

6

.

of 1000

50

(on direct labor)

(% of D.L)

$86 1000

Direct expenses $8
Manufacturing Overheads

1000

5% 50

Subtotal

950

Amount Units

$116.09 950

Direct labour $6
Direct expenses

Subtotal

Less

.5

Subtotal

Per unit cost

$0.14

950

903

47

Christa Cookies
PRODUCTION COST SHEET
JOB NUMBER :CC 002/22
PARTICULARS Process I Process II
Direct Materials used for

1000 $8 50
Raw materials used per unit $0.09
Production and transfer $80.50
Normal loss of inputs =

5%
Direct Labor $26 $6
Direct expenses 80% 75%
Manufacturing Overheads 10% 15%
Finished goods 900
Process I Amount Units
Cost of raw materials
Direct labour $24
$9.60
Subtotal $127.60
Less
Realization from normal loss of inputs
$122.20 950
Per unit cost $0.12
Number of units for process I
Cost of Process 1 $116.09
Balance due to abnormal loss $6.11
Process II
Cost from process I carried over
$7.50
Manufacturing overheads $10.50
$140.09
Realization from normal loss of outputs $0.15 47
$135.38 902.5
$0.14
Number of units for proces II 903
Cost of process II $128.60
Balance is due to abnormal gain $6.78
Closing Inventory
Cost per unit
Units produced
Units sold
Closing units
Cost of closing inventory $6.58

Sheet1

Cost

per ingredient

Total Cost

9/2/22 10h /day

$16

$4

Total

$9.60

86.50

Direct Labor 32.00

9.60

Christa Cookies
Job Order Cost Sheet
Job number: RCJ/002/22
Direct Material Direct Labor Manufacturing overhead
Ingredients Total Date Hours Rate Total Cost per employee
<2 employees> <30% of Direct Labor Costs>
Wheat flour $60 9/2/22 10h /day $ 0.8 /hr $16 30% of $32 =

$

9.60
Caster Sugar $13 $ 0.8/hr
Baking Powder $4
Fat $5.50
Vanilla
$

86.50 32.00
Cost Summary
Direct Materials
Manufacturing Overhead
128.10
Units 1,000
Cost per unit 0.13

2

>CM Breakeve

n

,

00,000

0,000

00,000

80,000

90,000.00

.00

,200.00

5,000.00

Cookie Business
Chocolate Chip Sugar Specialty
Total
Units Sold 1 5 9 8 3 2,

7
Sales $ 1,875,000.00 $ 882,000.00 $ 1,050,000.00 $ 3,807,000.00
Less: Variable Costs $

6 $ 205,800.00 $ 8

1,000 $ 976,800.00
Contribution Margin $ 1,185,000.00 $ 676,200.00 $ 969,000.00 $ 2,8

30
Less: Common Fixed Costs $

12
Profit $ 2,705,200.00
Per item Contribution Margin
Weighted Average Contribution Margin
Break-even point in units

Full Variable

Cookie Business

0

9,000.00

2,780,000

Productions Costs:
Direct material $ 0.60
Direct labor $ 1.00
Variable manufacturing overhead $ 0.

4
Total variable manufacturing costs per unit $ 2.00
Fixed manufacturing overhead per year $

13
In addition, the company has fixed selling and administrative costs:
Fixed selling costs per year $ 50,000.00
Fixed administrative costs per year $ 65,000.00
Selling price per cookie $ 3.75
Number of cookies produced
Number of cookies sold 2,600,000
Full (absorption) costing :
Full cost per unit
Ending Inventory Full (absorption) costing
Variable costing :
Variable cost per unit
Ending Inventory Variable costing

Special Order

Cookie Business

1,000

$ 3.75

0.00

Number of cookies needed
Discounted price per cookie $ 2.75
Normal price per cookie
Cost of special printed design per cookie $ 0.50
Cost of tool needed to make the design $

10
Revenue for special order
Costs for special order:
Design cost
Tool cost
Net increase (decrease) in profit

IRR

Cookie Business

.00

n

1

7

2

3

18

4

21

5

18

6

14

7

8

9

10

11

12

13

14

15

As the owner of the Cookie Business, you are considering the following investment:
PV of Annuity Table
Purchase of new equipment $ 250,000 1% 2% 3% 4% 5% 6% 8% 10% 12%
Expected annual increase in sales $ 48,017.50 0.9901 0.9804 0.9709 0.96

15 0.9524 0.9434 0.9259 0.9091 0.8929
Time frame years 1.9704 1.9416 1.9135 1.8861 1.8594 1.8334 1.7833 1.7355 1.6906
Acceptable rate needed 9% 2.941 2.8839 2.8286 2.7751 2.7233 2.673 2.5771 2.4869 2.

40
3.902 3.8077 3.7171 3.6299 3.546 3.4651 3.

31 3.1699 3.0374
Calculate the Internal Rate of Return: 4.8534 4.7135 4.5797 4.

45 4.3295 4.2124 3.9927 3.7908 3.6048
PV of annuity factor 5.7955 5.60

14 5.4172 5.2421 5.0757 4.9173 4.6229 4.3553 4.

11
Internal rate of return 6.7282 6.472 6.2303 6.0021 5.7864 5.5824 5.2064 4.8684 4.5638
7.6517 7.3255 7.0197 6.7327 6.4632 6.2098 5.7466 5.3349 4.9676
Accept or reject 8.566 8.1622 7.7861 7.4353 7.1078 6.8017 6.2469 5.759 5.3283
9.4713 8.9826 8.5302 8.1109 7.7217 7.3601 6.7101 6.1446 5.6502
10.3676 9.7869 9.2526 8.7605 8.3064 7.8869 7.139 6.4951 5.9377
11.2551 10.5753 9.954 9.3851 8.8633 8.3838 7.5361 6.8137 6.1944
12.1337 11.3484 10.635 9.9857 9.3936 8.8527 7.9038 7.1034 6.4236
13.0037 12.1063 11.2961 10.5631 9.8986 9.295 8.2442 7.3667 6.6282
13.8651 12.8493 11.938 11.1184 10.3797 9.7123 8.5595 7.6061 6.8109

Cash Budget

Cookie Business

$ 250,000

January February March

Total

The budgeted credit sales are as follows:
December last year
January $ 125,000
February $ 300,000
March $ 90,000
Collection:
Month of the sale 80%
Month following the sale 20%
Estimated cash receipts
Last month’s sales
Current month’s sales

Variances

Cookie Business

30

31

45

40

Actual Cost of Direct Materials $ 225,000
Standard Cost of Direct Materials $ 224,800
Actual Materials Used
Standard Materials Used
Actual Direct Labor Rate $ 15.50
Standard Labor Rate $ 15.00
Actual Hours Worked
Standard Hours Worked
Amount Favorable/ Unfavorable
Calculate Materials Variances:
Materials Price Variance
Materials Quantity Variance
Calculate Labor Variances:
Labor Rate Variance
Labor Efficiency Variance

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