Prepare a contribution margin income statement

Assignment Help Managerial Accounting
Reference no: EM131000201 , Length:

Option #: Budgeting

Choose an item that you would like to manufacture. You do not actually need to manufacture something, but will proceed through the assignment as if you were planning on manufacturing the item you have selected. The product should require materials and labor and be something that you are familiar with in process from start to finish. The product must be useful and marketable. You can choose something as simple as making chocolate chip cookies, a type of craft, or something more complicated. Consider production as if you were making the product from beginning to end, and not as if using a kit.

Perform the following steps:

Choose a product to manufacture and describe the manufacturing process.

Prepare the following budgets for 1 quarter, broken down monthly, regarding your chosen item:
estimated sales budget
estimated direct materials budget
estimated direct labors budget
estimated manufacturing overhead budget
estimated selling and administrative expenses
estimated income statement.

Classify all manufacturing costs and selling and administrative expenses as either variable or fixed.

Prepare a contribution margin income statement separating all variable and fixed costs into their own categories.

Determine the breakeven point in units and dollars. Also determine the number of units and dollars that need to be sold to make a target profit of $5,000 a month.

Identify what types of trends you should be aware of in the industry and who the primary competitors are.

Answer the following question: If you had to improve the bottom line, what would you do and what concerns would you have going forward?
Choose a piece of equipment that you might consider purchasing to increase production of your item and address the following questions: What types of capital budgeting factors would you look at when deciding whether to do this? What would be the relevant costs that you would consider in this decision?

Your final project should be in the form of a paper, using Microsoft Word, that addresses each of these different areas. Steps #1, 6, 7 and 8 will be in paragraph form and Steps #2, 3, 4 and 5 will involve numerical calculations that should be put into the form of a table in proper format and included as part of the paper. You should show any calculations in a table within Word. Your paper should be 3-6 double-spaced pages (body of the paper)

No of Pages/Words : 3-6

Verified Expert

The solution contains identification of a product to be manufactured and preparation of various budgets like sales budget, material budget, labour budget, budgeted income statement etc. The solution also contains calculation of breakeven point and target income to generate required profit.

Reference no: EM131000201

Tax bases-budget financing-budget deficits

Contrast the 3 major classes of tax bases, also addressing economic bases. Examine various methods of government financing in their budget, and give a synthesis of the streng

Calculate the amount of fixed manufacturing overhead

Calculate the amount of fixed manufacturing overhead that will be included in ending inventory under full costing and reconcile it to the difference between income computed un

Trey monson starts a merchandising business on december

1. Trey Monson starts a merchandising business on December 1 and enters into the following three inventory purchases. During December, Monson sells 15 units for $ 20 each on D

Prepare an equivalent units schedule using the method

All material is added at the start of production and all products completed are transferred out. Refer to Nelson Corporation. Prepare an equivalent units schedule using the me

Compute the ratios indicated and place the proper numbers

From the following information, compute the ratios indicated and place the proper numbers in the spaces provided. Assume the average for the year is the same as the ending bal

Profitability ratios of hershey for its years ending

Compute or identify the following profitability ratios of Hershey for its years ending December 31, 2009, and December 31, 2008. Interpret its profitability using the results

Prepare an income statement using absorption costing

Prepare an income statement using absorption costing - For problems, be sure to answer all questions and provide all requested information. Your response should be at least 7

Compute the total budget variances for materials and labor

Compute the total budget variances for materials and labor. Compute the costs of leather and direct labor that should be incurred for the production of 40,000 leather belts.

Reviews

Write a Review

 
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd