Instructions
Southern New Hampshire University
College of Continuing Education (COCE)
ACC 202 - 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 Services Schedule.
Location Grooming
Vision Day Care
Mission Boarding
2. 2. 2.
Identify the following: Calculate the break-even units: Create an Income Statement.
Direct Materials Grooming Revenue will be provided at the end of week 4.
Diret Labor Day Care
Manufacturing Overhead Boarding
Period Costs Calculate the break-even for target profits:
3. Grooming 3.
Day Care
Calculate the Variable and 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
ACC202 - MANAGERIAL ACCOUNTING
Company Profile
/xl/drawings/drawing1.xml#CompanyProfile
Variable and 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
COS Schedule
/xl/drawings/drawing1.xml#COGMSchedule
Income Statement
/xl/drawings/drawing1.xml#'Income%20Statement'!A1
Variances
/xl/drawings/drawing1.xml#Variances
Instructions Milestone 1
/xl/drawings/drawing1.xml#InstructionsMilestone1
Instructions Milestone 2
/xl/drawings/drawing1.xml#'Instructions%20-%20Milestone%202'!InstructionsMilestone2
Instructions Milestone 3
/xl/drawings/drawing1.xml#'Instructions%20-%20Milestone%203'!InstructionsMilestone3
Instructions - Milestone 1
Southern New Hampshire University
College of Continuing Education (COCE)
ACC 202 - Managerial Accounting
INSTRUCTIONS FOR MILESTONE 1 (Due Week 2)
IMPORTANT NOTE:
Make sure to completely review the rubric 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.
COMPANY PROFILE TAB
Determine a company name. Be creative (e.g., "Inspiring Dog Care").
Pick a location (e.g., "Chicago").
Define your company's vision and mission for how your business will add value to the community.
COST CLASSIFICATION
Accurately classify all of your costs (direct material, direct labor, manufacturing overhead, period costs).
Fixed and variable cost designation is provided.
VARIABLE AND FIXED COSTS
Determine your per-unit cost per dog for grooming, day care, and boarding.
OPERATIONAL AND 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 among the services (grooming, day care, boarding)
SALARY & HIRING DATA
Groomer - $12.00 an hour, 40 hours a week
Day Care Attendant - $9.00 per hour, 22 days per month, 8 hours a day
Receptionist - $8.50 per hour, 30 hours a week
Kennel Attendant - $11.50 per hour, 22 days per month, 8 hours a day
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 Carry 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
Rubberized Flooring for Day Care - $3,800
Boarding:
12 Kennels; Depreciation is $80 per month
General:
Food and 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 will 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
.
ACC202 - MANAGERIAL ACCOUNTING
HOME
/xl/drawings/drawing2.xml#Home
Company Profile
MILESTONE 1 - Company Profile
Company Name Brilliant Dog Care Services
Location Florida
Vision To be the best dog care providers in Florida
Mission Efficiency and quality well defines us!
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ACC202 - MANAGERIAL ACCOUNTING
HOME
/xl/drawings/drawing3.xml#Home
Cost Classification
Brilliant Dog Care Services
MILESTONE 1 - Cost Classification Exercise
INSTRUCTIONS:
Classify each item or cost as: Direct Material, Direct Labor, Manufacturing Overhead, or Period Costs.
Place an X in the appropriate column. No numbers are needed.
The fixed and variable cost classifications have been provided for you. For more information, see Objective 1 in Chapter 5.
Item/Cost Direct Material Direct Labor Manufacturing Overhead Period Costs Fixed Variable
Groomer X X
Day care attendant X X
Receptionist X X
Kennel attendant X
Food and water bowls X X
Fencing for day care area X
Installation of fencing X
Dog grooming arm (attaches to table) X
12 kennels cost X
Depreciation on kennels X
Rent X X
Utilities and insurance X X
Grooming table X X
Grooming tub 48" X X
Heating system X X
Depreciation on heating system X X
Clippers X
Shampoo (Crystal Clear: five-gallon pail) X X
Cage bank (set of five) X
Salon Tuff Capri mobile carry cart X
Towels X
Scissors (7-inch straight, ear & nose) X
Toys (used in day care only) X X
Cleaning products (used throughout) X X
Dryer X
Rubberized flooring (day care) X X
Loan X X
Draw X X
&8ACC202 - MANAGERIAL ACCOUNTING
HOME
/xl/drawings/drawing4.xml#Home
Variable_Fixed
Brilliant Dog Care Services
MILESTONE 1 - Variable and Fixed Cost Exercise
INSTRUCTIONS:
Determine the per-unit cost for each dog.
Fill in the blanks to get the per-unit cost and fixed cost of each service. Most costs are provided for you. Only fill in the missing costs.
Based on 5 grooms per day
GROOMING
Item Variable Costs Item Fixed Costs
Shampoo $ 1.040 Groomer $ 2,080.01
Clipper(s) 1.37 Rent 30.95
Bowls 0.72 Loan 20.00
Towels 5.83 Utilities and Insurance 28.57
Scissors 1.01 Depreciation on heating system 3.95
Cleaning Products: Odoban 2.08
Cleaning Products: Simple Green 2.36
Draw 200.00
Total Variable Costs $ 9.97 Total Fixed Costs $ 2,367.92
Based on 22 dogs per day, 25 operating days for day care, and 22 eight-hour work days for day care attendant.
DAY CARE
Item Variable Costs Item Fixed Costs
Day care attendant $ 2.88 Rent $ 232.14
Toys 0.27 Loan 150.00
Bowls 0.19 Utilities and Insurance 214.29
Towels 1.40 Depreciation on heating system 29.64
Cleaning Products: Odoban 15.59
Cleaning Products: Simple Green 16.78
Draw 200.00
Total Variable Costs $ 4.74 Total Fixed Costs $ 858.44
Based on 12 dogs per day, 30 operating days for boarding, and 22 eight-hour work days for kennel attendant.
BOARDING
Item Variable Costs Item Fixed Costs
Kennel attendant $ 5.62 Depreciation on kennels $ 80.00
Bowls 0.86 Rent 386.90
Towels 0.87 Loan 250.00
Utilities and Insurance 357.14
Depreciation on heating system 49.40
Cleaning Products: Odoban 25.98
Cleaning Products: Simple Green 29.55
Draw 200.00
Total Variable Costs $ 7.35 Total Fixed Costs $ 1,378.97
&8ACC202 - MANAGERIAL ACCOUNTING
HOME
/xl/drawings/drawing5.xml#Home
Sheet1
Instructions - Milestone 2
Southern New Hampshire University
College of Continuing Education (COCE)
ACC 202 - Managerial Accounting
INSTRUCTIONS FOR MILESTONE 2 (Due Week 4)
IMPORTANT NOTE:
Make sure to completely review the rubric for Milestone 2.
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 (Green Tabs):
GENERAL
Use data from Milestone 1 in your analysis.
CONTRIBUTION MARGIN ANALYSIS
Select a price for each service (grooming, day care, boarding).
Determine the variable cost from the Variable_Fixed tab for each service.
Calculate the contribution margin for each service based on your sales price and the variable cost for that service.
BREAK-EVEN ANALYSIS
Determine the fixed cost from the Variable_Fixed tab for each service.
Fixed and Variable cost designation is provided.
Calculate the break-even units (round up) for each service.
Calculate the break-even units (round up) for suggested target profit levels for each service.
ACC202 - MANAGERIAL ACCOUNTING
HOME
/xl/drawings/drawing6.xml#Home
Contribution Margin Analysis
Brilliant Dog Care Services
MILESTONE 2 - Contribution Margin per Unit and Contribution Margin Ratio
INSTRUCTIONS:
Select a price from the scenarios below and compute the contribution for each service based on your selected price.
Variable cost per unit comes from your Variable_Fixed tab completed in Milestone 1.
SCENARIO (choose one from each category):
Dog Day Care
1. With pricing at $18 per dog per day, you can expect to have 22 dogs per day.
2. With pricing at $20 per dog per day, you can expect to have 15 dogs per day.
3. With pricing at $25 per dog per day, you can expect to have 10 dogs per day.
Overnight Boarding
1. With pricing at $25 per dog per day, you can expect to have 12 dogs per day.
2. With pricing at $28 per dog per day, you can expect to have 10 dogs per day.
3. With pricing at $30 per dog per day, you can expect to have 7 dogs per day.
Basic Groom
1. With pricing at $25 per dog per day, you can expect to have 5 dogs per day.
2. With pricing at $30 per dog per day, you can expect to have 4 dogs per day.
3. With pricing at $35 per dog per day, you can expect to have 3 dogs per day.