Nou plan to open a small business for manufacturing pet collars, leashes, and harnesses. You have found a workshop space you can use for sewing your products. After some research and planning, you have estimates for the various operating costs for your business. The total square footage for the sewing rooms is 1,500 square feet broken into three areas (500 square feet each). You have taken out a loan for start-up costs, and the monthly payment is $550, it goes into effect immediately and should be accounted for in your costs. You will also collect a modest salary for the first year of $500 per month, remember to divide evenly among the services. . Salary and Hiring Data T One collar maker, who will be paid $16.00 per hour and work 40 hour per week One leash maker, who will be paid $16.00 per hour and work 40 hours per week One harness maker, who will be paid $17.00 per hour and work 40 hours per week One receptionist, who will be paid $15.00 per hour and work 30 hours per week . 6 . Other Costs Rent: $750 per month; allocate based on square footage High-tensile strength nylon webbing-$12 per yard of webbing 3 collars per yard of webbing 2 leashes per yard of webbing 2 harnesses per yard of webbing Polyesterylon ribbons-$9 per yard of ribbon 3 collars per yard of webbing 2 leashes per yard of webbing 2 harnesses per yard of webbing Buckles made of cast hardware-$0.50 per buckle 4 buckles used per collar 3 buckles used per leash O 8 buckles used per harness 3 industrial sewing machines at $3,300 each for a total of $9,900; depreciation is $155 per month (5- year life) Utilities and insurance $600 per month, allocate based on square footage Scissors, thread, cording $1,200 Price tags: $250 for 2,500 (S0.10 each) Office supplies $2,400 or $200 per month Other business equipment: $2,000 Loan payment of $550 per month Salary drawn of $500 per month 2 Milestone Three - Statement of Cost of Goods Sold WN 4 0 0 6 Beginning Work in Process Inventory 7 Direct Materials: 8 Materials: Beginning 9 Add: Purchases for month of January 11 Materials available for use 12 Deduct: Ending materials 14 Materials Used 15 16 Direct Labor 17 Overhead 0 19 Total Costs 20 21 Deduct: Ending Work in Process Inventory 22 23 Cost of Goods Sold 24 25 26 1 2 Milestone Three - Income Statement 3 $ $ $ 4 5 Revenue: 6 Collars 7 Leashes 8 Harnesses 9 10 Total Revenue: 11 Cost of goods sold 12 Gross profit 13 14 Expenses: 15 General and administrative salaries 16 Depreciation 17 Rent 18 Utilities and insurance 19 Scissors, thread, and cording 20 Loan 21 22 Total Expenses 23 24 Net Income/Loss 25 26 $ $ $ Data for Variance Analysis: Budgeted (Standard) Hours/Qty Budgeted (Standard) Rate Actual Hours/Qty Actual Rate Labor Materials Variances for Collar Sales Variance Favorable/ Unfavorable Direct Labor Time Variance (Actual Hours - Standard Hours) x Standard Rate $ Direct Labor Rate Variance (Actual Rate - Standard Rate) x Actual Hours $ Direct Materials Quantity/Efficiency Variance (Actual Quantity - Standard Quantity) Standard Price $ Direct Materials Price Variance (Actual Price - Standard Price) Actual Quantity Nou plan to open a small business for manufacturing pet collars, leashes, and harnesses. You have found a workshop space you can use for sewing your products. After some research and planning, you have estimates for the various operating costs for your business. The total square footage for the sewing rooms is 1,500 square feet broken into three areas (500 square feet each). You have taken out a loan for start-up costs, and the monthly payment is $550, it goes into effect immediately and should be accounted for in your costs. You will also collect a modest salary for the first year of $500 per month, remember to divide evenly among the services. . Salary and Hiring Data T One collar maker, who will be paid $16.00 per hour and work 40 hour per week One leash maker, who will be paid $16.00 per hour and work 40 hours per week One harness maker, who will be paid $17.00 per hour and work 40 hours per week One receptionist, who will be paid $15.00 per hour and work 30 hours per week . 6 . Other Costs Rent: $750 per month; allocate based on square footage High-tensile strength nylon webbing-$12 per yard of webbing 3 collars per yard of webbing 2 leashes per yard of webbing 2 harnesses per yard of webbing Polyesterylon ribbons-$9 per yard of ribbon 3 collars per yard of webbing 2 leashes per yard of webbing 2 harnesses per yard of webbing Buckles made of cast hardware-$0.50 per buckle 4 buckles used per collar 3 buckles used per leash O 8 buckles used per harness 3 industrial sewing machines at $3,300 each for a total of $9,900; depreciation is $155 per month (5- year life) Utilities and insurance $600 per month, allocate based on square footage Scissors, thread, cording $1,200 Price tags: $250 for 2,500 (S0.10 each) Office supplies $2,400 or $200 per month Other business equipment: $2,000 Loan payment of $550 per month Salary drawn of $500 per month 2 Milestone Three - Statement of Cost of Goods Sold WN 4 0 0 6 Beginning Work in Process Inventory 7 Direct Materials: 8 Materials: Beginning 9 Add: Purchases for month of January 11 Materials available for use 12 Deduct: Ending materials 14 Materials Used 15 16 Direct Labor 17 Overhead 0 19 Total Costs 20 21 Deduct: Ending Work in Process Inventory 22 23 Cost of Goods Sold 24 25 26 1 2 Milestone Three - Income Statement 3 $ $ $ 4 5 Revenue: 6 Collars 7 Leashes 8 Harnesses 9 10 Total Revenue: 11 Cost of goods sold 12 Gross profit 13 14 Expenses: 15 General and administrative salaries 16 Depreciation 17 Rent 18 Utilities and insurance 19 Scissors, thread, and cording 20 Loan 21 22 Total Expenses 23 24 Net Income/Loss 25 26 $ $ $ Data for Variance Analysis: Budgeted (Standard) Hours/Qty Budgeted (Standard) Rate Actual Hours/Qty Actual Rate Labor Materials Variances for Collar Sales Variance Favorable/ Unfavorable Direct Labor Time Variance (Actual Hours - Standard Hours) x Standard Rate $ Direct Labor Rate Variance (Actual Rate - Standard Rate) x Actual Hours $ Direct Materials Quantity/Efficiency Variance (Actual Quantity - Standard Quantity) Standard Price $ Direct Materials Price Variance (Actual Price - Standard Price) Actual Quantity