Requirment $7$: From a young age, Julie has always loved to bake. Julie went to culinary school to become a professiona

baker and open her own bakery. Although Julie has many skills in the kitchen, she knows nothing about

business, so she decides to take a Managerial Accounting course before opening her bakery. While taking

she is fully prepared to get it up and running. Put yourself in Julie's shoes to prepare to open your bakery

by the end of the semester

Follow the prompts below, that align with the content of each chapter, and use Excel to prepare yourself

to get your bakery up and running:

Below is a list of business$-$related expenses Julie is expecting to have in her first year of business:

Bakery Rent

Julie's $($Supervisor$)$ Salary

Baker's Wages

Hourly Bakery Cashier

Tax Accountant

Ingredients $($Sugar$,$ Butter, Eggs, Milk, Baking Powder, Flour$)$

Bakery Utilities

Bakery Insurance

Bakery Oven Depreciation

Business Cards

Cake Boxes

Bakery Refrigerator Depreciation

Latex Gloves for Bakers

Microsoft Office Suite Subscription $($Excel$)$

Please categorize each cost as Direct vs$.$ Indirect, Product $($DM$/$DL$/$MOH$)$ vs$.$ Period, and Prime

vs$.$ Conversion using the dropdowns in Excel.

Julie does not have enough money to hire a Managerial Accountant, so she must track he

business expenses herself. First think about what type of costing system would be more

beneficial for Julie. She chooses to use Excel to track all her business transactions. To test this

out, she has prepared an estimate of her purchases for the first month of business below. This

will help her have a better understanding of how to track the flow of her inventory.

a$.$ Purchase $$10,000$ in ingredients $($Sugar$,$ Butter, Eggs, Milk, Baking Powder, Flour$)$ and

$$5,000$ in other supplies$/$materials $($Cake Boxes, Latex Gloves for Bakers$)$ to get started.

b$.$ Each wedding cake that will require $ $125$ in ingredients, $$10$ for a cake box, and $$15$ in

other supplies$/$materials$.$ Julie plans on producing $60$ weddings cakes in the first month.

c$.$ The wedding cake will take $6$ hours to make, and Julie estimates she will pay bakers

$$\frac{20}{?}$ hr$.$ Julie's salary will be $$5000$ for the first month.

d$.$ Julie expects the first month's utilities to be $$500,$ rent to be $$2000,$ insurance to be

$$100,$ and bakery equipment depreciation to be $$1000.$ e$.$ Julie would like to use a bakery$-$wide rate for manufacturing overhead allocation using

direct labor hours. She estimates that total Manufacturing Overhead will be $$100,000$

and direct labor hours will be $5000$ hours for the year

f$.$ Calculate the total manufacturing cost of the wedding cake by adding together the direct

materials, direct labor, and allocated manufacturing overhead for the job.

g$.$ Julie plans to sell $50$ wedding cakes for $$800$ each

h$.$ Calculate the cost per cake to find the Cost of Goods Sold for $50$ Cakes.

Julie might want to use activity$-$based costing instead of a bakery$-$wide rate for allocating

overhead. If Julie uses the following activities and estimated costs, how much should she

allocate to the $60$ wedding cakes that required $360$ direct labor hours, $120$ machine hours, and

$60$ cake boxes.

Use Excel to calculate the allocation rate for each activity to find the amount of overhead that

should be allocated to the wedding cake.

Look at how the allocated overhead under the activity$-$based costing differs from the bake

Use the data provided to complete the master budget and determine whether or not Julie has enough money saved up to get her started.

Round all answers to the nearest whole number except the direct materials budget $($should be rounded to two decimals$)$

Budget #$1$: Sales Budget

Budgeted units to be sold

Sales price per unit

Total Sales

Budget #$2$: Production Budget

Budgeted units to be sold

Plus: Desired units in ending inventory

Total units needed

Less: Units in beginning inventory

Budgeted units to be produced

Budget #$3$: Direct Materials Budget $($Eggs$)$

Budgeted units to be produced

Direct materials $($eggs$)$ per unit

Direct materials needed for production

Plus: Desired direct materials in ending inventory $($eggs$)$

Total direct materials needed

Less: Direct materials in beginning inventory $($eggs$)$

Budgeted purchase of direct materials

Direct material cost per egg

Budgeted cost of direct materials purchases

Round up to the nearest whole egg

Budget #$4$: Direct Labor Budget

Budgeted units to be produced