1 Choose three recipes for your food that your company will produce. (potato soup, spaghetti, Cesar salad)

2 Separate ingredients into a table with Ingredients, quantity, cost and whether the ingredient is fixed variable or mixed

Potato Soup:2 tablespoons butter,1 medium onion, chopped (about 1/2 cup)1 stalk celery, thinly sliced (about 1/2 cup)1 3/4 cups chicken broth, 3 medium potatoes, peeled and cubed (about 3 cups)1 1/2 cups milk,1 tablespoon chopped fresh parsley.

Spaghetti:1 box of spaghetti uncooked, 1-1/2 pounds ground Italian sausage,1 cup onion, chopped,3/4 cup green bell pepper, chopped,2 (26-ounce) jars pasta sauce, any flavor,1/2 cup grated Parmesan cheese.

Caesar salad:1/2 cup Caesar dressing,1/2 head romaine lettuce, torn into 2- or 3-inch pieces,1 cup toasted croutons,1/2 cup shaved Parmesan cheese,1/2 tsp coarsely ground black pepper,4 lemon wedges.

2 Separate ingredients into a table with Ingredients, quantity, cost and whether the ingredient is fixed variable or mixed

3 Price the ingredients at a store

Per Box or item

Butter$2.49

OnionX2$2.49 per

Celery$1.39 per Lb.

Chicken broth$1.99 per 32 oz.

Potato$3.49 bag of 10lbs.

Milk$2.79 for a gallon

Parsley$1.50 each

box of spaghetti$1.49 per box

2 pounds ground Italian sausage$3.99 per lb.

green bell pepper$.79 each

pasta sauce per jar$2.50 per jar

Parmesan cheese$4.49 per 5oz

Caesar dressing$4.77 per 12fl oz

romaine lettuce$3.49 per 5oz

croutons$1.99 per 5oz

ground black pepper$4.99 per 1oz

lemon $.59 each

4 Calculate the ingredients cost in your recipes - remember if flour comes in a large package you will need to calculate the cost of what's needed

5 Calculate the cost of ingredients for your batches of food and the cost of a single unit.

6 Make any adjustments you feel necessary to make your product better or more cost-effective. Document all changes. Additional Costs to add to your product: You rent a kitchen/shop for $3,500 a month for cookies/brownies/cupcakes, $3,750 for bread/muffins and $4,000 for pizza. Electricity is $.75 an hour for electricity (everything except pizza) 1.25 for pizza whenever you are working, plus a $35 a month base fee. Can make your product 40 hours a week with your single worker making $12 an hour. Packaging materials cost $.10 a batch of cookies (20)/brownies (12), .15 per loaf of bread/muffins (6)/cupcakes(12) and .30 for each pizza. Other fixed costs (lease and maintenance of ovens) are $450 a month for cookies/brownies/cupcakes, $500 for bread/muffins and $550 for pizza. Selling and admin costs (per month) $550 for cookies/brownies/cupcakes, $700 for bread/muffins and $800 for pizza

7 Determine how long it will take for each batch of cookies, bread, and pizza from start to finish. Next, divide this into your available hours to determine your capacity in batches of cookies/bread/pizza.

8 Price (needs to be realistic) your product to include a profit, you can add a worker to increase volume, however, you cannot expand beyond three

9 What is your breakeven?

10 What is your breakeven if you pay yourself?

11 What is your breakeven if ingredients cost increases 15%?

12 Need a flexible budget for 75 batches below and above breakeven

13 Choose an allocation base and use the single overhead rate to determine the cost of your product on a batch/per loaf/per pizza

14 Need a budget for the year assume you can sell all the product you make

15 Need a budgeted cash flow for the year, taking loans if necessary