You have conducted some market research for style and size of products you want to use to launch your business. The market research has indicated the following sales price ranges will be optimal for your area depending on style of products you choose to sell:

• Collars
  • With pricing at $20 per collar, you can expect to sell 30 collars per day.
  • With pricing at $24 per collar, you can expect to sell 25 collars per day.
  • With pricing at $28 per collar, you can expect to sell 20 collars per day

• Leashes
  • With pricing at $22 per leash, you can expect to sell 28 leashes per day.
  • With pricing at $26 per leash, you can expect to sell 23 leashes per day.
  • With pricing at $30 per leash, you can expect to sell 18 leashes per day.

• Harnesses
  • With pricing at $25 per harness, you can expect to sell 25 harnesses per day.
  • With pricing at $30 per harness, you can expect to sell 22 harnesses per day.
  • With pricing at $35 per harness, you can expect to sell 20 harnesses per day.

Additionally, you will need to compare your break-even points for the following target profits for each area of your business to determine your prices:

• Collars
  • Break-even
  • $300 target profit each month
  • $500 target profit each month

• Leashes
  • Break-even
  • $400 target profit each month
  • $600 target profit each month

• Harnesses
  • Break-even
  • $500 target profit each month
  • $650 target profit each month

Remember that all break-even and target points must be in whole units (we cannot sell a partial unit). Round up when calculating partial units to ensure costs are covered. Excel tip use ROUNDUP function

You have conducted some market research for style and size of products you want to use to launch your business. The market research has indicated the following sales price ranges will be optimal for your area depending on style of products you choose to sell:

• Collars
  • With pricing at $20 per collar, you can expect to sell 30 collars per day.
  • With pricing at $24 per collar, you can expect to sell 25 collars per day.
  • With pricing at $28 per collar, you can expect to sell 20 collars per day

• Leashes
  • With pricing at $22 per leash, you can expect to sell 28 leashes per day.
  • With pricing at $26 per leash, you can expect to sell 23 leashes per day.
  • With pricing at $30 per leash, you can expect to sell 18 leashes per day.

• Harnesses
  • With pricing at $25 per harness, you can expect to sell 25 harnesses per day.
  • With pricing at $30 per harness, you can expect to sell 22 harnesses per day.
  • With pricing at $35 per harness, you can expect to sell 20 harnesses per day.

Additionally, you will need to compare your break-even points for the following target profits for each area of your business to determine your prices:

• Collars
  • Break-even
  • $300 target profit each month
  • $500 target profit each month

• Leashes
  • Break-even
  • $400 target profit each month
  • $600 target profit each month

• Harnesses
  • Break-even
  • $500 target profit each month
  • $650 target profit each month

Remember that all break-even and target points must be in whole units (we cannot sell a partial unit). Round up when calculating partial units to ensure costs are covered. Excel tip use ROUNDUP function

• Cost Classification. Accurately classify all your costs in the Cost Classification tab of your workbook.
  • Identify direct material, direct labor, overhead, and period costs. (Note: Fixed and variable costs have been classified for you.)
• Variable and Fixed Costs. Complete the Variable and Fixed Costs tab of your workbook. (Note: Some costs are provided for you. Fill in only the missing costs.)
  • Determine your total variable cost per unit and the total fixed costs for each product. Show your work using calculations to the side of the table or using appropriate formulas in the table.

What to Submit

Submit the Project Workbook with the Cost Classification and Fixed and Variable Costs tabs completed.

pecifically, you must address the following rubric criteria:

• Contribution Margin. Determine your contribution margin per unit in the Contribution Margin Analysis tab.
  • Choose a sales price for each product.
  • Calculate the contribution margin for each product based on your sales price and the variable cost for that product. Show your work using calculations to the side of the table or using appropriate formulas in the table.
• Break-Even Analysis. Use cost-volume-profit (CVP) analysis to determine your break-even points for achieving your target profits in the Break-Even Analysis tab.
  • Determine the break-even points for each product. Show your work using calculations to the side of the table or using appropriate formulas in the table.
  • Determine break-even units for the suggested target profits for each product. Show your work using calculations to the side of the table or using appropriate formulas in the table.

You plan to open a business manufacturing collars, leashes, and harnesses for pets. To begin, you will manufacture these in a standard style and size with plans to expand your range over the year. In a few weeks, you will present your companys financial strategy to some key investors. To begin creating your strategy, you need to consider and record all the costs associated with operating your business. You have decided to use the job order costing system.

What to Submit

Submit the Project Workbook with the Contribution Margin Analysis and Break-Even Analysis tabs completed.

Putting an X in the appropriate spot, classify the costs as: Direct Material, Direct Labor, Overhead, or Period Costs. The Fixed and Variable cost classifications have been provided for you. Milestone Two - Break-Even Analysis Milestone Two - Contribution Margin Analysis Sales Price per Unit Variable Cost per Unit Contribution Margin Putting an X in the appropriate spot, classify the costs as: Direct Material, Direct Labor, Overhead, or Period Costs. The Fixed and Variable cost classifications have been provided for you. Milestone Two - Break-Even Analysis Milestone Two - Contribution Margin Analysis Sales Price per Unit Variable Cost per Unit Contribution Margin