Case_13_Huntington_Hospital_

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InstructionsSouthern New Hampshire UniversityCollege of
Continuing Education (COCE)ACC202 - Managerial
AccountingMILESTONE 1 (Due in Module 2)MILESTONE 2
(Due in Module 4)MILESTONE 3 (Due in Module
5)1.1.1.NameChoose a price range and calculate:Create a Cost
of Goods Manufactured ScheduleLocationGroomingVisionDay
CareMissionBoarding2.2.2.Identify the following:Calculate the

break-even unitsCreate an Income StatementDirect
MaterialsGroomingRevenue will be provided end of week
4Diret LaborDay CareManufacturing OverheadBoardingPeriod
CostsCalculate the break-even for target
profits3.Grooming3.Day CareCalculate the Variable & Fi xed
Costs for:BoardingCalculate for the Grooming
line:GroomingDirect Labor Time VarianceDay CareDirect
Labor Rate VarianceBoardingDirect Materials Efficiency
VarianceDirect Materials Price Variance
ACC202 - MANAGERIAL ACCOUNTING
Company Profile/xl/drawings/drawing1.xml#CompanyProfile
Variable & Fixed
Costs/xl/drawings/drawing1.xml#VariableFixedCosts
Cost Classification
/xl/drawings/drawing1.xml#CostClassification
Contribution
Margin/xl/drawings/drawing1.xml#ContributionMargin
Break-Even
Analysis/xl/drawings/drawing1.xml#BreakevenAnalysis
COGM Schedule/xl/drawings/drawing1.xml#COGMSchedule
Income Statement/xl/drawings/drawing1.xml#COGMSchedule
Variances/xl/drawings/drawing1.xml#Variances
Instructions Milestone
1/xl/drawings/drawing1.xml#InstructionsMilestone1
2/xl/drawings/drawing1.xml#'Instructions%20-
%20Milestone%202'!InstructionsMilestone2
Instructions - Milestone 1Southern New Hampshire
UniversityCollege of Continuing Education (COCE)ACC202 -
Managerial AccountingINSTRUCTIONS FOR MILESTONE 1
(Due Week 2)IMPORTANT NOTE:Make sure to completely
review the Rubric for Milestone 1Use 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):GENERALYou plan to open a pet
services business that will offer dog grooming, day care and
boardingCOST CLASSIFICATIONAccurately classify all of
your costs (direct material, direct labor, manufacturing
overhead, period costs)Fixed & Variable cost designation is
providedVARIABLE & FIXED COSTSDetermine your per unit
cost per dog for grooming, day care and
boardingOPERATIONAL & COST INFORMATION:For
simplicity, base all calculations using 30 days in each
monthOPERATIONAL DATAGrooming:The Groomer can
groom 5 dogs a day, 5 days a weekEach grooming takes 1.5
labor hoursDay Care:The Day Care can house 10 large dogs and
12 small dogs daily.Day Care is offered 6 days a
weekBoarding:There are 12 kennels (single dog only).Boarding
(kennel services) is offered every dayFacilities:The Grooming
facility is 200 square feetThe Boarding facility is 2,500 square
feetThe Day Care facility is 1,500 square feetGeneral:Loan for
start-up costs - monthly payment of $420; in effect
immediately; limited cash and loan funding - used angel
investorsModest monthly draw of $600 a month for first year;
should be divided evenly amoung the services (grooming, day
care, boarding)SALARY & HIRING DATAGroomer (Allison) -
$12.00 an hour, 40 hours a weekDay Care Attendant (Beverly) -
$9.00 per hour, based on needReceptionist (Cathie) - $8.50 per
hour, 30 hours a weekKennel Attendant (Ben) - $11.50 per hour,
based on needOTHER COST DATAGrooming:Dog Grooming
Arm - $300.Grooming Table - $900Grooming Tub -
$2,800Clippers - $136.99; can be used for 100 groomsShampoo
- $103.96 per 5-gallon pail; can be used for 100 groomsSalon
Tuff Capri Mobile Carry Cart - $90Scissors (7 inch straight) -
$194.99; used for 200 groomsScissors (ear and nose) - $7.49;
used for 200 groomsDay Care:Fencing for Day Care area -
$1,249Fencing Installation - $1,000Toys - $3.29 per 6 pack;
one toy will last for two dogs in day care per dayRubberized

Flooring for Day Care - $3,800Boarding:12 Kennels;
Depreciation is $80 per monthGeneral:Food & Water bowls -
$3.59 per unitDay Care - two bowls last for every 75 dogs that
attend daycareBoarding - two bowls last for every 100 dogs
boarded; two bowls per kennelGrooming - each bowl lasts for
20 grooms and you need 4 bowls at all timesTowels - $34.99 per
12 packDay Care - 12 towels for every 25 dogsBoarding - 12
towels for every 40 dogsGrooming - 2 towels for every groom
per dayHeating System - $10,000; Depreciation is $83 per
month; Allocate based on square footageRent - $650 per month;
Allocate based on square footageUtilities / Insurance - $600 per
month; Allocate based on square footageCage Bank - $2,200 per
set of 5Dryer - $1,250Cleaning ProductsOdoban - $14.55 per
gallon; Each area wil dilute 1 oz to 1 gallon of water; Allocate
based on square footageSimple Green - $15.66 per gallon; Each
area will dilute 1 oz to 1 gallon of water; Allocate based on
square footage.
HOME/xl/drawings/drawing2.xml#Home
Cost ClassificationMilestone 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/CostDirect
MaterialDirect
Labor
OverheadPeriod Costs FixedVariableSalary - Collar
makerxSalary - Leash makerxSalary - Harness makerxSalary -
ReceptionistHigh-tensile strength nylon webbing
xPolyester/nylon ribbons xBuckles made of cast hardware
xDepreciation on sewing machinesxRentxUtilities and
insurancexScissors, thread, and cordingxPrice tagsxOffice
suppliesOter business equipmentLoan payment xSalary to selfx
&8ACC202 - MANAGERIAL ACCOUNTING

Variable and Fixed CostsMilestone One - Variable and Fixed
CostsCollarsItemVariable Cost/ItemItemFixed CostsHigh-
tensile strength nylon webbing $ 4.00Collar maker's salary
(monthly)$ 2,773.33Polyester/nylon ribbons Depreciation on
sewing machinesBuckles made of cast hardware RentPrice
tagsUtilities and insuranceScissors, thread, and cordingLoan
payment$ 183.33Salary to self$ 166.67Total Variable Costs
per CollarTotal Fixed CostsLeashesItemVariable
Cost/ItemItemFixed CostsHigh-tensile strength nylon webbing
Leash maker's salary (monthly)Polyester/nylon ribbons
Depreciation on sewing machinesBuckles made of cast hardware
RentPrice tagsUtilities and insuranceScissors, thread, and
cordingLoan paymentSalary to selfTotal Variable Costs per
LeashTotal Fixed Costs$ - 0HarnessesItemVariable
Harness maker's salaryPolyester/nylon ribbons Depreciation on
tagsUtilities and insuranceScissors, thread, and
cordingLoanSalary to selfTotal Variable Costs per HarnessTotal
Fixed Costs
MILESTONE (Green Tabs):GENERALUse data from Milestone
1 in your analysisCONTRIBUTION MARGIN ANALYSISSelect
a price for each service (grooming, day care,
boarding)Determine the variable cost from the Variable_Fixed
tab for each serviceCalculate the contribution margin for each

service based on your sales price and the variable cost for that
serviceBREAK-EVEN ANALYSISDetermine the fixed cost
from the Variable_Fixed tab for each serviceFixed & Variable
cost designation is providedCalculate the break-even units
(round up) for each serviceCalculate the break-even units
(round up) for suggested target profit levels for each service
Contribution Margin AnalysisMilestone Two - Contribution
Margin AnalysisCOLLARSLEASHESHARNESSESSales Price
per UnitVariable Cost per UnitContribution Margin
Break-Even AnalysisMilestone Two - Break-Even
AnalysisCOLLARSLEASHESHARNESSESSales Price$ - 0$
- 0$ - 0Fixed Costs$ - 0$ - 0$ - 0Contribution Margin$ -
0$ - 0$ - 0Break-Even Units (round up)- 0- 0- 0Target Profit$
300.00$ 400.00$ 500.00Break-Even Units (round up)- 0- 0-
0Target Profit$ 500.00$ 600.00$ 650.00Break-Even Units
(round up)- 0- 0- 0
MILESTONE (Purple Tabs):GENERALUse data from Milestone
1 and Milestone 2 in your analysisRevenue data needed for the
Income Statement will be provided at the end of Module 4COST
OF SERVICES PROVIDED SCHEDULEUse the data at the top

of the schedule to complete the reportINCOME
STATEMENTUse the data at the top of the schedule to
complete the reportUse the data from your Cost of Services
Provided ScheduleVARIANCESUse the data at the top of the
schedule to calculate the following:VarianceFavorable /
Unfavorable
COGSMilestone Three - Statement of Cost of Goods
SoldBeginning Work in Process Inventory0Direct
Materials:Materials: Beginning0Add: Purchases for month of
January$ 20,000Materials available for use20,000$
20,000.00Deduct: Ending materials(4,000)$ (4,000.00)starting
inventory + Purchases- ending inventory= cost of goods
sold.Materials Used 16,000$ 16,000$ 8,493.33Direct
Labor3,765OverheadTotal Costs28,258Deduct: Ending Work in
Process Inventory-Cost of Goods Sold28,258
Income StatementMilestone Three - Income
StatementRevenue:Collars$ 39,520$
39,520Leashes35,00035,000Harnesses39,70039,700Total
Revenue:$ 114,220$ 114,220Cost of goods sold28,258Gross
profit$ 85,962Expenses:General and administrative salaries$
2,450$ 2,450Depreciation165$ 165Rent750$ 750Utilities
and insurance600$ 600Scissors, thread, and cording$ 1,200$
1,200Loan550$ 550Total Expenses$ 5,715.00Net
Income/Loss$ 80,326.67$ 80,326.67
VariancesMilestone Three - Variance AnalysisData for Variance
Analysis:Budgeted (Standard)
Hours/QtyBudgeted (Standard)
RateActual

Hours/QtyActual
RateLaborMaterialsVariances for Collar
SalesVarianceFavorable/
UnfavorableDirect Labor Time Variance(Actual Hours -
Standard Hours) x Standard Rate$ - 0Direct Labor Rate
Variance(Actual Rate - Standard Rate) x Actual Hours$ -
0Direct Materials Quantity/Efficiency Variance(Actual Quantity
- Standard Quantity) x Standard Price$ - 0Direct Materials
Price Variance(Actual Price - Standard Price) x Actual
Quantity$ - 0
profits3.Grooming3.Day CareCalculate the Variable & Fixed
Variable & Fixed
Cost Classification

Contribution
Break-Even
1/xl/drawings/drawing1.xml#Instructio nsMilestone1

square footage.
MaterialDirect
Labor
makerXxSalary - Leash makerXxSalary - Harness
makerXxSalary - ReceptionistXHigh-tensile strength nylon
webbing XxPolyester/nylon ribbons XxBuckles made of cast
hardware XxDepreciation on sewing
machinesXxRentXxUtilities and insuranceXxScissors, thread,
and cordingXxPrice tagsXxOffice suppliesXOter business
equipmentXLoan payment XxSalary to selfXxDepreciation on
sewing machines - this cost is spread between the three products
based on amount of space used.Rent - this cost is spread
between the three products based on amount of space used.
Utilities and insurance - this cost is spread between the three
products based on amount of space used. Price tags - materials
used for each unit of product. Loan Payment - this cost is split
evenly between the products. Salary to self - this cost is split
evenly between the products. Hint: Look at Variable_Fixed tab -
if it is a Variable cost, it is a Direct cost, if it i s a Fixed cost
other than direct labor salaries, it is Overhead. If neither, it's
not charged to product expense and is a Period cost.

(monthly)$ 2,773.33*Polyester/nylon ribbons $
3.00*Depreciation on sewing machines$ 55.00*Buckles made
of cast hardware $ 2.00*Rent$ 250.00*Price tags$ 2.00
Ann Laramy: Ann Laramy:
This should be the same as you have for Leashes and Harnesses.
One price tag per unit, $250 for 2500 tags.*Utilities and
insurance$ 200.00*Scissors, thread, and cording$ 1,200.00
$1200 for Scissors, thread and cording divided between the
three products. *Loan payment$ 183.33Salary to self$
166.67Total Variable Costs per Collar$ 11.00Total Fixed
Costs$ 4,828.33LeashesItemVariable Cost/ItemItemFixed
CostsHigh-tensile strength nylon webbing $ 6.00*Leash
maker's salary (monthly)$ 2,773.33*Polyester/nylon ribbons $
of cast hardware $ 1.50*Rent$ 250.00*Price tags$
0.10*Utilities and insurance$ 200.00*Scissors, thread, and
cording$ 33.33
three products*Loan payment$ 183.33*Salary to self$
166.67*Total Variable Costs per Leash$ 12.10Total Fixed
Costs$ 3,661.66HarnessesItemVariable Cost/ItemItemFixed
CostsHigh-tensile strength nylon webbing $ 6.00*Harness
maker's salary$ 2,946.67*Polyester/nylon ribbons $
of cast hardware $ 4.00*Rent$ 250.00*Price tags$
0.10*Utilities and insurance$ 200.00*Scissors, thread, and
cording$ 33.33
three products

This should be the same as you have for Leashes and Harnesses.
One price tag per unit, $250 for 2500 tags.*Loan$
183.33*Salary to self$ 166.67*Total Variable Costs per
Harness$ 14.60Total Fixed Costs$ 3,835.00*All answers
should be entered as formulas to show your work, not numbers.
This was covered in the instructions and announcements.
per UnitVariable Cost per UnitContribution Margin

AnalysisCOLLARSLEASHESHARNESSESSales Price$ - 0$
- 0$ - 0Fixed Costs$ - 0$ - 0$ - 0Contribution Margin$ -
0$ - 0$ - 0Break-Even Units (round up)- 0- 0- 0Target Profit$
300.00$ 400.00$ 500.00Break-Even Units (round up)- 0- 0-
0Target Profit$ 500.00$ 600.00$ 650.00Break-Even Units
(round up)- 0- 0- 0
Unfavorable
JanuaryMaterials available for useDeduct: Ending materials-

0Materials Used Direct LaborOverheadTotal CostsDeduct:
Ending Work in Process Inventory0Cost of Goods Sold
StatementRevenue:Collars$ - 0Leashes- 0Harnesses- 0Total
Revenue:$ - 0Cost of goods sold- 0Gross profit$ -
0Expenses:General and administrative salaries$ -
0Depreciation- 0Rent- 0Utilities and insurance- 0Scissors,
thread, and cordingLoan- 0Total Expenses$ - 0Net
Income/Loss$ - 0
RateActual
Hours/QtyActual
Quantity$ - 0

profits3.Grooming3.Day CareCalculate the Variable & Fixed
Variable & Fixed
Cost Classification
Contribution
Break-Even
1/xl/drawings/drawing1.xml#InstructionsMilestone1

square footage.
MaterialDirect
Labor
makerxSalary - Leash makerxSalary - Harness makerxSalary -
ReceptionistHigh-tensile strength nylon webbing
xPolyester/nylon ribbons xBuckles made of cast hardware
xDepreciation on sewing machinesxRentxUtilities and
insurancexScissors, thread, and cordingxPrice tagsxOffice
suppliesOter business equipmentLoan payment xSalary to selfx

(monthly)$ 2,773.33Polyester/nylon ribbons Depreciation on
tagsUtilities and insuranceScissors, thread, and cordingLoan
payment$ 183.33Salary to self$ 166.67Total Variable Costs
per CollarTotal Fixed CostsLeashesItemVariable
Leash maker's salary (monthly)Polyester/nylon ribbons
Depreciation on sewing machinesBuckles made of cast hardware
RentPrice tagsUtilities and insuranceScissors, thread, and
cordingLoan paymentSalary to selfTotal Variable Costs per
LeashTotal Fixed Costs$ - 0HarnessesItemVariable
Harness maker's salaryPolyester/nylon ribbons Depreciation on
tagsUtilities and insuranceScissors, thread, and
cordingLoanSalary to selfTotal Variable Costs per HarnessTotal
Fixed Costs

per Unit$ 20.00$ 22.00$ 25.00Variable Cost per
Unit11.0011.0011.00This should be the variable costs from
Milestone 1 Variable and Fixed Costs tab. Each product has a
different variable cost. Contribution Margin$ 9.00$ 11.00$
14.00(Sales-Variable Cost)
AnalysisCOLLARSLEASHESHARNESSESSales Price$ 20.00$
22.00$ 25.00Fixed Costs$ 4,828$ 4,828$ 4,828Fixed costs
are different for each product. These should be from the
Variable and Fixed Costs tab. It looks like you had corrections
to make on that tab from Milestone 1. Contribution Margin$
11.00$ 11.00$ 11.00See comments on Contribution Margin
tab.Break-Even Units (round up)438.94439.00439.00(fixed
cost/contribution margin)$ 439$ 439$ 439Formula is
correct, but values are not so unit calculations are incorrect.
Target Profit$ 300.00$ 400.00$ 500.00Break-Even Units
(round up)466.21475.30484.39(fixed
cost+targetprofit)/contribution margin)$ 467476$ 485Target
Profit$ 500.00$ 600.00$ 650.00Break-Even Units (round
up)484.39493.48498.03(fixed cost+target profit)/contribution

margin)485494499Formula is correct, but values are not so unit
calculations are incorrect.
Unfavorable
JanuaryMaterials available for useDeduct: Ending materials-
0Materials Used Direct LaborOverheadTotal CostsDeduct:
Ending Work in Process Inventory0Cost of Goods Sold
StatementRevenue:Collars$ - 0Leashes- 0Harnesses- 0Total

Revenue:$ - 0Cost of goods sold- 0Gross profit$ -
0Expenses:General and administrative salaries$ -
0Depreciation- 0Rent- 0Utilities and insurance- 0Scissors,
thread, and cordingLoan- 0Total Expenses$ - 0Net
Income/Loss$ - 0
RateActual
Hours/QtyActual
Quantity$ - 0

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