Imagine you are planning to start a new small, home-based food business. You are going to make and sell a single food item.

What is the food item that your business will sell?

food item is chocolate pound cake.

Assumptions:

• Youare starting your business next month, so currently you have no beginning inventory of finished goods or raw materials. Also, there is no beginning balance for accounts payable or accountsreceivable.
• Since the business is very small and home-based, there is no direct labour cost for your business. Labour wage (if any) is assumed to be fixed and part ofMOH.
• All the manufacturing costs you incur for your business fall under any one of the two categories: direct material (DM) or MOH. (Remember indirect material is part of MOH)
• Tocalculate the DM cost for your product, find out a simple recipe for the product you are planning to sell. Youcanvisit any physical store to collect data. All information must be collected physically/ through the internet. If you can't find any information you need on the internet, make reasonableguesses.
• For each of your direct materials fill out the following table. Make more copies of the table if necessary.Youneed to have a separate table for each directmaterial.

• Direct Material 1:

Direct material item name	flour
Quantity required for each unit of product	128 grams
Desired ending inventory as a percentage of following month's production requirement
Price per unit of direct material	7.04 BDT

• for the product, you are planning to sell. Youcanvisit any physical store to collect data. All information must be collected physically/ through the internet. If you can't find any information you need on the internet, make reasonableguesses.
• For each of your direct materials fill out the following table.

Direct Material 2:

Direct material item name	sugar
Quantity required for each unit of product	96grams
Desired ending inventory as a percentage of following month's production requirement
Price per unit of direct material	8.16bdt

Direct Material3:

Direct Material Name	egg
Quantity Required for Each Unit of Product	2
Desired Ending Inventory as a Percentage of Following Month's Production Requirement
Price Per Unit of Direct Material	18.5 BDT

Direct Material4:

Direct Material Name	cocoa powder
Quantity Required for Each Unit of Product	25
Desired Ending Inventory as a Percentage of Following Month's Production Requirement
Price Per Unit of Direct Material	36 BDT

Direct Material5:

Direct Material Name	Baking Powder
Quantity Required for Each Unit of Product	8.4 grams
Desired Ending Inventory as a Percentage of Following Month's Production Requirement
Price Per Unit of Direct Material	1 BDT

Direct Material6:

Direct Material Name	Milk
Quantity Required for Each Unit of Product	118 ml
Desired Ending Inventory as a Percentage of Following Month's Production Requirement
Price Per Unit of Direct Material	10.15 BDT

Direct Material7:

Direct Material Name	Butter
Quantity Required for Each Unit of Product	90 ml
Desired Ending Inventory as a Percentage of Following Month's Production Requirement
Price Per Unit of Direct Material	90 BDT

Direct Material8:

Direct Material Name	Water
Quantity Required for Each Unit of Product	177 ml
Desired Ending Inventory as a Percentage of Following Month's Production Requirement
Price Per Unit of Direct Material	2.65 BDT

Based on the recipe and information you have collected from the internet, calculate the total direct material cost for making one unit of yourproduct.

Now, have to calculate MOH costs for your business. Remember, TotalMOH = VariableMOH + Fixed MOH.

Assume, indirect materials are the only thing included in your variable MOH. Identify some indirect materials for your product, and assume a rate of variable MOH cost for each unit ofproduct.

• Youdonothavetomakeanybudgetforindirectmaterial. ThevariableMOHrateyou have assumed in the previous table will be used for preparing the MOH budget.
• SincedepreciationispartoffixedMOH,wewillnowcalculate depreciationexpenses.

Tocalculate depreciation expense, first, identify the equipment you will need to make your product. Next, find the cost(s) of the equipment on the internet. Then, make estimation(s) about useful life. Finally,calculate the depreciation expense per month usingastraight-linedepreciationmethod.Showyourcalculationsinthefollowingtable.

Total Direct Material cost per unit:

Details	Amount	Amount
Flour	7.04
Sugar	8.16
Egg	18.5
Cocoa Powder	36
Baking Powder	1
Milk	10.15
Butter	90
Water	2.65
Total		173.5 BDT

Variable Manufacturing Overhead and its cost per unit of the product:

Details	Amount
Baking Paper	0.81 BDT

Add more rows to the table if necessary.

Equipment and depreciation per month:

Equipment Name	Cost	Useful Life	Depreciation Expense
Baking Oven	10500 BDT	13 Years	65 BDT
Beater Machine	4000 BDT	10 Years	30 BDT
Baking mold, bowl, whisk, spatula	2000 BDT	3 Years	55 BDT
Refrigerator	23000 BDT	12 Years	140 BDT

Total depreciation expense per month:

Details	Amount
Baking Oven	65
Beater Machine	30
Baking mold, bowl, whisk, spatula	55
Refrigerator	140
Total	290 BDT

.Write the total depreciation expense included in fixed MOH based on your calculations in the lasttable.

All the equipment you have identified above will be purchased in the first month of your business, i.e. January2022.

.Identify all other monthly fixed MOH expenses for your business. Remember,it is a small, home-based business so you do not have to make many complicated assumptions. Youhave already calculated depreciation expense in the above table. List all fixed expenses, including depreciation expense calculated above, in the following table.

Add more rows to the table as necessary.

Fixed MOH Expense Item Name	Fixed Expense Per Month
electricity	300
depreciation	290 total 590 bdt

• Write the total fixed MOH expense, including depreciation expense, based on the list you have prepared in the lasttable.
• Remember, Total selling and administrative (Sn'A) expense = Variable Selling and Administrative expenses + Fixed Selling and Administrative expenses
• Yourvariable Sn'A expense consists of only two items - delivery expense per unit and packaging cost per unit. Write estimations about delivery expense per unit and packaging cost per unit in the following table. Also, add the two numbers to calculate the total variable Sn'A expense for each unit ofproduct.
• Yourfixed advertising expense consists of only one item - Facebook/social media advertising expense. Write your estimation about your monthly advertising expense. This is your total fixed Sn'A expense permonth.
• Calculate your total variable expenses for each unit of a product by adding the direct material cost per unit, variable MOH rate per unit, and variable Sn'A expense per unit of product.
• Calculate your selling price per unit by charging a 200% mark-up on per unit variable expense.
• Now,we will make some estimations about the number of units of product your business expects to sell over the next 12 months. Fill out the following table about sales estimates.

Total variable Sn'A expense per unit:

Total fixed advertising expense per month:

Details	Amount
Facebook/Social media advertisement	1200 BDT

Total variable expense for each unit:

Details	Amount	Amount
Direct material cost	173.5
Variable manufacturing overhead	0.81
Variable Sn'A expense	125
Total		299.31 BDT

Selling price per unit:

Details	Amount
Selling price (299.31*200%)	598.62 BDT

Details	Amount
Delivery expense	100
Packaging cost	25
Total	125 BDT

Month	Estimated Units of Product Sold
January	25 units
February	25 units
March	25units
April	30units
May	30units
June	40units
July	40units
August	50units
September	50units
October	60units
November	60units
December	60units

• Assume all sales will be in cash and will collect 100% of therevenue.
• Since you are going to sell a food item, no ending inventory of finished goods will be maintained. Each unit will be manufactured after an order isreceived.
• All purchases for all direct materials are made fully incash.
• Youwant to draw dividends/drawings of BDT 20,000 every month as the sole owner of your business.[This isyour dividend/drawings,youwillnotusethismoneyforoperating yourbusiness.]
• At the end of each month, you want to have at least BDT 50,000 cash available for operating yourbusiness.
• Youwill start the business with a cash investment of BDT500,000.
• Youcan borrow up to BDT 200,000 from your best friend to invest in yourbusiness.
• Youmay repay any borrowed amount, even if you have sufficient cash available, any time during the nextyear.

Requirements:

Based on the assumptions you have formed above, prepare Master Budget consisting of the following components in the Google Sheet attached to this assignment.

1. SalesBudget[Noscheduleofcashcollectionwillbeneeded asallsalesareoncash.]

2. Direct Material Budget(s) [Make a separate budget for each direct material. No schedule ofcashdisbursementsfordirectmaterials willbenecessaryasallpurchaseswillbemade in cash.]

3. MOHBudget.

4. Selling and Administrative ExpenseBudget

5. CashBudget

Youwill not need any production budget since units sold = units produced every month. Thus, the sales estimate you have formed above will also be used as the number of units produced in the MasterBudget.

please help with these questions I need an answer to no3, manufacturing overhead budget. please help and ignore blank table. please help. i have done the first part

	January	February	March	April	May	June	July	August	September	October	November	December	Total
Budgeted Sales in Unit	25	25	25	30	30	40	40	50	50	60	60	60	495
Selling Price per Unit	598.62	598.62	598.62	598.62	598.62	598.62	598.62	598.62	598.62	598.62	598.62	598.62	598.62
Total Budgeted Sales	14965.5	14965.5	14965.5	17958.6	17958.6	23944.8	23944.8	29931	29931	35917.2	35917.2	35917.2	296316.9