You would like to start a business in March 2020 manufacturing a smart phone controlled robot for recreational use. In preparation for an interview with the bank to discuss your financing needs, you develop answers to the following questions. A number of assumptions are required (and some are provided for you below clearly note all assumptions that you make. Instructions (a) Identify the types of costs that would likely be involved in making this product by populating a spreadsheet with the five columns indicated below. Item Product Costs Direct Manufacturing Labor Overhead Direct Materials Period I would like to see a minimum of 6 manufacturing overhead costs and 7 period costs You should show one line item for both direct materials and direct labor but please provide some detail of the costs in parentheses Assien hypothetical monthly dollar figures to each costs you identified The totals for cach column must be $480,000 for Direct Materials, $220,000 for direct labor $40,000 for Manufacturing Cherhead, and $300.000 for period costs (b) Assume you have no raw materials or work in process beginning or ending inventories. Prepare a projected cost of goods manufactured schedule for the first month of operations (c) You must produce 40,000 robots the first month of operations (March 2020). Compute the cost to produce one robot. (d) What type of cost accounting system will you likely use job order or process costing? Explain your answer! (c) Explain how you would assign costs in either the job order or process costing system you plan to use (1) Classify your costs as either variable or fixed costs. For simplicity assign all costs to either variable or fixed, assuming there are no mixed costs, using the format shown Item Variable Costs Fixed Cests Total Costs (3) Compute the unit variable cost (rounded to two decimal places, using the production (h) You will sell 35.000 robots the first month of operations. Set a unit selling price between $30 and 538 rounded to the nearest whole dollar, and compute both the contribution margin per unit and the contribution margin ratio (1) Determine your break-even point in dollars and in units. 0 Prepare projected operating budgets (sales, production, direct materials, direct labor, manufacturing overhead, selling and administrative expense, and income statement You will need to use the below assumptions for each of the following: Direct materials budget: 12 kg of direct materials required to produce one robot S10,00 per kg: desired ending direct materials (assume Direct materials budget: 1.2 kg of direct materials required to produce one robot; $10.00 per kg; desired ending direct materials (assume none). 0.5 hours required per robot; rate is $11.00 per hour. Direct labor budget: Budgeted income statement: Income tax expense is 35% of income from operations. (k) Prepare a cash budget for the month. Assume the percentage of sales that will be collected from customers is 85%, and the percentage of direct materials that will be paid in the current month is 60%. Income taxes are paid in April. (1) The relevant range of activity is from 35,000 to 40,000 robots per month. Recast your manufacturing overhead budget into a flexible monthly budget for each increment of 1,000 robots produced from 35,000 to 40,000 robots. (m) Identify one potential cause of materials, direct labor, and manufacturing overhead variances for your product. (n) Assume that you wish to purchase production equipment that costs $5,000,000. Determine the cash payback period, utilizing the monthly cash flow that you computed in part (k) multiplied by 12 months (for simplicity). (0) Identify at least three nonfinancial factors that should be considered before commencing your business venture. You would like to start a business in March 2020 manufacturing a smart phone-controlled robot for recreational use. In preparation for an interview with the bank to discuss your financing needs, you develop answers to the following questions. A number of assumptions are required (and some are provided for you below); clearly note all assumptions that you make. Instructions (a) Identify the types of costs that would likely be involved in making this product by populating a spreadsheet with the five columns indicated below. Item Direct Materials Product Costs Direct Manufacturing Labor Overhead Period Costs I would like to see a minimum of 6 manufacturing overhead costs and 7 period costs. You should show one line item for both direct materials and direct labor but please provide some detail of the costs in parentheses, Assign hypothetical monthly dollar figures to each costs you identified. The totals for each column must be $480,000 for Direct Materials, S220,000 for direct labor. $40,000 for Manufacturing Overhead, and $300,000 for period costs. (b) Assume you have no raw materials or work in process beginning or ending inventories. Prepare a projected cost of goods manufactured schedule for the first month of operations. (c) You must produce 40,000 robots the first month of operations (March 2020). Compute the cost to produce one robot. (d) What type of cost accounting system will you likely use job order or process costing? Explain your answer! (e) Explain how you would assign costs in either the job order or process costing system you plan to use. (1) Classify your costs as either variable or fixed costs. For simplicity, assign all costs to either variable or fixed, assuming there are no mixed costs, using the format shown. Item Variable Costs Fixed Costs Total Costs (8) Compute the unit variable cost (rounded to two decimal places), using the production number in (c) (h) You will sell 35,000 robots the first month of operations. Set a unit selling price between $30 and $38 rounded to the nearest whole dollar, and compute both the contribution margin per unit and the contribution margin ratio. (1) Determine your break-even point in dollars and in units. () Prepare projected operating budgets (sales, production, direct materials, direct labor, manufacturing overhead, selling and administrative expense, and income statement). You will need to use the below assumptions for each of the following: Direct materials 1.2 kg of direct materials required to produce one robot; budget: $10.00 per kg; desired ending direct materials (assume none). Direct labor 0.5 hours required per robot; rate is $11.00 per hour. budget: Budgeted income Income tax expense is 35% of income from operations. statement: (k) Prepare a cash budget for the month. Assume the percentage of sales that will be collected from customers is 85%, and the percentage of direct materials that will be paid in the current month is 60%. Income taxes are paid in April. (1) The relevant range of activity is from 35,000 to 40,000 robots per month. Recast your manufacturing overhead budget into a flexible monthly budget for each increment of 1,000 robots produced from 35,000 to 40,000 robots. (m) Identify one potential cause of materials, direct labor, and manufacturing overhead variances for your product. (n) Assume that you wish to purchase production equipment that costs $5,000,000. Determine the cash payback period, utilizing the monthly cash flow that you computed in part (k) multiplied by 12 months (for simplicity). (0) Identify at least three nonfinancial factors that should be considered before commencing your business venture