to value her inventory items and would like to know how much money she is making on each product. Your task is to compute the standard inventory cost and gross profit margin for four of her top selling items; Bath-Bombs, Mini-Bombs, Bomb-in-a-Bag and Bubbling Bath Salts. 1) In excel, begin with the recipe of direct materials for each item. Create a conversion chart for how bulk weights purchased are converted to direct materials used for each inventory item. Assign direct materials cost to each item. Next, assign direct labor costs based on labor cost per hour and time required to make each item. Don't forget to also add the cost of packaging. Combine the direct materials, direct labor and packaging costs for each item to arrive at a total cost per unit. Finally, using current selling price and cost per unit, calculate gross margin for each of the four inventory items. What is the gross profit when the business owner might run a "buy 4 get 1 free" promotional offer? Which item is most profitable? Which item is the least profitable, and why? Calculate the break-even unit and sales if the manufacturing overhead cost is 40% from the conversion cost and the fixed operating cost is 20% from the total product cost. 2) Write a memo to the business owner that describes how you used cost accounting concepts to arrive at your inventory values and gross profit margin amounts. Include your calculations when there is a "buy 4 get 1 free" sale. What recommendations do you have for the business owner? 3) Work together in small groups to decide on a final inventory cost and gross profit amount for Bath- Bombs, Mini-Bombs, Bomb-in-a-Bag and Bubbling Bath Salts. Create one final excel costing spreadsheet for the business owner that can be updated if the cost of bulk purchases or sales prices change. How the changes affect the breakeven unit and sales. 4) Finally, create a power point presentation that you will use when you deliver your presentation of calculations and recommendations on inventory costing to the business owner. The recipes, costs of direct materials, packaging costs, direct labor time and costs, and sales prices are listed below. A B C D E F Recipe for Bath Bombs, Bomb in a Bag, & Mini Bomb 600 cups baking soda cric acid 300 cups 0.75 cups com arch 0.50 cups 2:00 p psom sat tagrance of 3.00 tbsp mica 1.00 tbsp polysorbate 1 batch=10 (Basic) Bath Bombs 10 batch=5 Bomb-in-a-Bage 11 batch=10 bags of Min Bomba 6 7 13 Recipe for Bubbling Bath Salts 14 15 cups baking soda * 2 cups cnc acid 15 M 16 17 0.75 cups com starch 4 cups tbsp 3 tbsp 2 epsom sat tagrance of mica polysortate 1 tbsp 21 "f batch = 6 bags of Bubbing Bath Salts 18 19 GH Cost of Direct Materials J 50 pounds 50 pounds baking soda ctric acid com starch pom 50 pounds 50 pounds 1 pounds fragrance of 1 pounds mica polysorbate 1 gallon Cost of Direct Labor K 522 01 $7402 Cost of Packaging For each Buch Bomb For each Bomb-in-a-bag. Mini bomb Bath sas Minimum Wage per hour Social security Medicare FUTA K $69.00 $23.00 $95.00 $33.35 L 50.10 50 23 $13.50 062 x wage base 01401x wage base 06 x wage base M N 0 Sales price per unit Bath Bombs Bomb-in--Bag Min Bomb Bubbing Bath Salts P Bomb-in-a-bag MirBomba Bubbing Bath Salts $6.97 $10.00 $10.00 $10.00 Batch processing time in minutes Buth Bombs 30 Isu: 1 Semakan: