Overview: In the third milestone, you will jump forward in time: Imagine that your business has already opened. Use the updated scenario information to analyze your company’s performance. Post-opening Scenario: Your angel investors are silent in relation to the business; however, they require board meetings for status updates on the company’s financial health. Therefore, you need to analyze your company’s performance over the last month using the data provided below. Note: Your instructor will create an announcement sharing the income statement data by the end of Module Four. All of the data you need for the cost-of services statement can be found in the “COS Schedule” tab of your workbook. For your variance analysis, use the following financial data:

Direct Materials/Labor Original Projection Actual

Shampoo 1000 ounces ($2/groom) 1200 ounces ($3/groom)

Grooming Labor 1.5 hrs/groom @ $12 2.25 hrs/groom @ $11.50

Prompt: Complete your work in the provided workbook by assessing your company’s financial performance, specifically addressing the following critical elements:

Financial Statements

Create a statement of cost of services in the “COS Schedule” tab.

Create an income statement in the “Income Statement” tab.?

Variance Analysis

Identify all variances for the direct labor time and the materials price in the “Variances” tab.

Evaluate the significance of the variances in the “Variances” tab.

Incorporate all feedback from previous milestones to finalize your workbook

Houston Precious Kennels

MILESTONE 3 - Statement of Cost of Services

INSTRUCTIONS:

The following are the actual numbers for January:

Materials

Purchased $5,000 of Materials

Consumed 40% of those purchased materials

Direct Labor

Direct Labor was $6,240

Factory Overhead

Factory Overhead was $2,800

Houston Precious Kennels

Statement of Cost of Services

For the Month Ended January 31, xxxx

Beginning Work-in-Process Inventory

$ -

Direct Materials:

Materials - Beginning

$ -

Add: Purchases for month of January

-

Materials Available for Use

$ -

Deduct: Ending Materials

-

Materials Used

$ -

Direct Labor

-

Factory Overhead

-

Total Manufacturing Overhead

$ -

Deduct: Ending Work-in-Process Inventory

-

Cost of Services

$ -

	Houston Precious Kennels
	MILESTONE 3 - Income Statement
	INSTRUCTIONS:
	Complete the statement in proper form.
	Revenue will be provided in an announcement at the end of Module 4
	(Based on actual number of services for your pricing levels).
	Additional information necessary to complete the income statement:
	General and Administrative Salaries paid = $1,200
	Advertising = $100
	Cleaning Products = $120
	Depreciation = $83
	Rent = $650
	Loan = $420
	Utilities and Insurance = $600
Houston Precious Kennels
Income Statement
For the Month Ended January 31, xxxx
	Revenue:
	Grooming	$ -
	Day Care	-
	Boarding	-
	Total Revenue		$ -
	Cost of Goods Sold *		-
	Gross Profit		$ -
	Expenses:
	G&A Salaries	$ -
	Advertising	-
	Cleaning Products	-
	Depreciation	-
	Rent	-