You 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 One collar maker, who will be paid $$16\mathrm{.}00$ per hour and work $40$ hours per week One leash maker, who will be paid $$16\mathrm{.}00$ per hour and work $40$ hours per week One harness maker, who will be paid $$17\mathrm{.}00$ per hour and work $40$ hours per week One receptionist, who will be paid $$15\mathrm{.}00$ per hour and work $30$ hours per week Other Costs Rent: $$750$ per month; allocate based on square footage High$-$tensile strength nylon webbing$$12$ per yard of webbingo $3$ collars per yard of webbingo $2$ leashes per yard of webbingo $2$ harnesses per yard of webbing Polyester$/$nylon ribbons$$9$ per yard of ribbono $3$ collars per yard of ribbono $2$ leashes per yard of ribbono $2$ harnesses per yard of ribbon Buckles made of cast hardware$$0\mathrm{.}50$ per buckleo $4$ buckles used per collaro $3$ buckles used per leasho $8$ buckles used per harness $3$ industrial sewing machines at $$3,300$ each for a total of $$9,900$; depreciation is $$165$ per month $(5-$year life, zero salvage value$)$ Utilities and insurance: $$600$ per month; allocate based on square footage Scissors, thread, cording: $$1,200$ Price tags: $$250$ for $2,500($$$0\mathrm{.}10$ each$)$ Office supplies: $$2,400$ or $$200$ per month Other business equipment: $$2,000$ Loan payment of $$550$ per month Salary drawn of $$500$ per month$1$Milestone Three $-$ Statement of Cost of Goods Sold

Beginning Work in Process Inventory

Direct Materials:

Materials: Beginning

Add: Purchases for month of January

Materials available for use

Deduct: Ending materials

Materials Used

Direct Labor

Overhead

Total Costs

Deduct: Ending Work in Process Inventory

Cost of Goods Sold