Milestone One - Variable and Fixed Costs Collars Item Variable Cost/Item Item Fixed Costs High-tensile strength nylon webbing 4.00 Collar maker's salary (monthly) 2,773.33 Polyesterylon ribbons 3.00 Depreciation on sewing machines 5.00 Buckles made of cast hardware 0.13 Rent 250.00 Price tags 0.10 Utilities and insurance 200.00 Scissors, thread, and cording 400.00 Loan payment 183.33 Salary to self 166.67 Total Variable Costs per Collar $ 9.10 Total Fixed Costs $ 4,492.78 Leashes Item Variable Cost/Item Item Fixed Costs High-tensile strength nylon webbing 5.00 Leash maker's salary (monthly) 2,773.33 Polyesterylon ribbons 4.50 Depreciation on sewing machines 55.00 Buckles made of cast hardware 0.17 Rent 250.00 Price tags 0.10 Utilities and insurance 200.00 Scissors, thread, and cording 400.00 Loan payment 183.33 Salary to self 166.67 Total Variable Costs per Leash $ 12.10 Total Fixed Costs $ 4,492.78 Harnesses Item Variable Cost/Item Item Fixed Costs High-tensile strength nylon webbing 6.00 Harness maker's salary 2,946.66 Polyesterylon ribbons 1.50 Depreciation on sewing machines 55.00 Buckles made of cast hardware 0.06 Rent 250.00 Price tags 0.10 Utilities and insurance 200.00 Scissors, thread, and cording 400.00 Loan 183.33 Salary to self 166.67 Total Variable Costs per Harness $ 14.60 Total Fixed Costs $ 1,652.78Milestone Two - Contribution Margin Analysis COLLARS LEASHES HARNESSES Sales Price per Unit 5 20.00 5 22.00 5 25.00 Variable Cost per Unit 9.10 12.10 14.60 Contribution Margin 5 10.90 S 9.90 5 10.40 Milestone Two - Break-Even Analysis COLLARS LEASHES HARNESSES Sales Price S 20.00 S 22.00 S 25.00 Fixed Costs S 4,493 S 4,493 S 4,653 Contribution Margin S 10.90 $ 9.90 S 10.40 Break-Even Units (round up) 413.00 454.00 448.00 Target Profit S 300.00 S 400.00 S 500.00 Break-Even Units (round up) 440.00 495.00 496.00 Target Profit S 500.00 S 600.00 S 650.00 Break-Even Units (round up) 459.00 515.00 510.00Milestone Three - Statement of Cost of Goods Sold Beginning Work in Process Inventory Direct Materials: Materials: Beginning Add: Purchases for month ofJanuary Materials available for use Deduct: Ending materials Materials Used Direct Labor Overhead Total Costs Deduct: Ending Work in Process Inventory Cost of Goods Sold Milestone Three - Income Statement Revenue: Collars S - Leashes - Harnesses - Total Revenue: 5 Cost of goods sold Gross profit S Expenses: General and administrative salaries S - Office supplies - Other business equipment - Total Expenses 5 Net Income/Loss S Milestone Three - Variance Analysis Data for Variance Analysis: Budgeted Budgeted Actual Actual (Standard) (Standard) Hours/Qty Rate Hours/Qty Rate Labor Materials Variances for Collar Sales Favorable/ Variance Unfavorable Direct Labor Time Variance (Actual Hours - Standard Hours) x Standard Rate S Direct Labor Rate Variance (Actual Rate - Standard Rate) x Actual Hours S Direct Materials Quantity/Efficiency Variance (Actual Quantity - Standard Quantity) x Standard Price S Direct Materials Price Variance (Actual Price - Standard Price) x Actual Quantity S