task 1 Michelle and Vishayla need to know the cost per cake so they can be sure they are charging enough for each cake. They also need this to calculate the cost of goods sold. They feel that direct labor hour is the best cost driver for allocating manufacturing overhead. They pay their wage employees $12.00 per hour. Due to the type of production that they have, they believe job order costing is the best costing system. Here is the estimated data for 2020: Type of cake Expected Annual sales Selling Price per cake Direct Labor Hour per cake 1 tier wedding cake 2 tier wedding cake 3 tier wedding cake Large sheet cake Medium sheet cake Small sheet cake 300 400 100 450 600 750 $200 $400 $600 $120 $901 $75 Raw Ingredient (Direct Materials cost per cake $40 $50 $75 $25 $15 $10 Estimated annual amount $67,250 Expense Total direct materials Total direct labor Total factory overhead Selling Cost Administrative Costs Total Costs $120,600 $47,900 $17,500 $108,700 $361,950 Variable verses Fixed Costs Total Variable Costs $211,950 Total Fixed Costs $150,000 Total costs $361,950 Requirements: 1) Calculate the cost per cake 2) Create a budgeted Traditional Income Statement and a Contribution Income Statement 3) Calculate the breakeven point in dollars 4) Calculate a target profit in dollars for a profit of $125,000. Task 2 They believe it will cost them $250,000 to purchase the land near Fort Lee and to build a bakery and storefront. Your task is: 1) Calculate Return on Investment if the expected increase in net income, due to opening the new location near Ft. Lee, is $35,000. 2) Calculate Asset Turnover Rate and Margin if the expected sales increased to $450,000 3) Calculate Residual Income if the required rate of return is 15%. task 1 Michelle and Vishayla need to know the cost per cake so they can be sure they are charging enough for each cake. They also need this to calculate the cost of goods sold. They feel that direct labor hour is the best cost driver for allocating manufacturing overhead. They pay their wage employees $12.00 per hour. Due to the type of production that they have, they believe job order costing is the best costing system. Here is the estimated data for 2020: Type of cake Expected Annual sales Selling Price per cake Direct Labor Hour per cake 1 tier wedding cake 2 tier wedding cake 3 tier wedding cake Large sheet cake Medium sheet cake Small sheet cake 300 400 100 450 600 750 $200 $400 $600 $120 $901 $75 Raw Ingredient (Direct Materials cost per cake $40 $50 $75 $25 $15 $10 Estimated annual amount $67,250 Expense Total direct materials Total direct labor Total factory overhead Selling Cost Administrative Costs Total Costs $120,600 $47,900 $17,500 $108,700 $361,950 Variable verses Fixed Costs Total Variable Costs $211,950 Total Fixed Costs $150,000 Total costs $361,950 Requirements: 1) Calculate the cost per cake 2) Create a budgeted Traditional Income Statement and a Contribution Income Statement 3) Calculate the breakeven point in dollars 4) Calculate a target profit in dollars for a profit of $125,000. Task 2 They believe it will cost them $250,000 to purchase the land near Fort Lee and to build a bakery and storefront. Your task is: 1) Calculate Return on Investment if the expected increase in net income, due to opening the new location near Ft. Lee, is $35,000. 2) Calculate Asset Turnover Rate and Margin if the expected sales increased to $450,000 3) Calculate Residual Income if the required rate of return is 15%