Acme Pickle Company Cost Report PDF

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Acme Pickle Company Cost Report

February 2020 Capella Uni y MBA5010

Managerial Accounting • Planning and Control Decision Making • Internal orientation • Cost – Volume – Profit Analysis

Financial Accounting • Preparation of Financial Statements • Externally Oriented • High Accuracy

Current Cost Report Item • Cucumbers • Spices & Vinegar • Jars & Lids • Direct Labor, paid by the case • Line Supervisors, on salary • Depreciation on factory • Property Taxes on factory • Insurance on factory Total Costs Cost per case(9,000 cases produced)

$15,000 $11,000 $10,000 $30,000 $10,000 $10,000 $3,000 $1,000 $90,000 $10

Fixed Costs • Line Supervisors, on salary • Depreciation on factory

$10,000 $10,000

• Property Taxes on factory • Insurance on factory

$3,000 $1,000

Variable Costs • Cucumbers • Spices & Vinegar

$15,000 $11,000

• Jars & Lids • Direct Labor, paid by the case

$10,000 $30,000

Recalculated Cost Report • Cucumbers $1.67 x 11,000 • Spices & Vinegar $1.22 x 11,000 • Jars & Lids $1.11 x 11,000 • Direct Labor, paid by the case $3.33 x 11,000 • Line Supervisors, on salary • Depreciation on factory • Property Taxes on factory • Insurance on factory Total Costs Cost per case(11,000 cases produced)

$18,370 $13,420 $12,210 $36,630 $10,000 $10,000 $3,000 $1,000 $104,630 $9.51

Recalculated Cost Report • Cucumbers $1.67 x 12,000 • Spices & Vinegar $1.22 x 12,000 • Jars & Lids $1.11 x 12,000 • Direct Labor, paid by the case $3.33 x 12,000 • Line Supervisors, on salary • Depreciation on factory • Property Taxes on factory • Insurance on factory Total Costs Cost per case(12,000 cases produced)

$20,040 $14,640 $13,320 $39,960 $10,000 $10,000 $3,000 $1,000 $111,960 $9.33

Recommendation • • • •

Normal Monthly Revenue 9,000 cases sold at $20 = $180,000 Production Cost = $90,000 Total = $90,000

• • • • • • •

Increased Production Revenue 11,000 cases produced 9,0000 cases sold at $20 = $180,000 2,000 cases sold at $9.50 = $19,000 Total = $199,000 Production Cost = $104,630 Total Revenue = $94,370

References

• Marshall, D., McManus, W., & Viele, D. (2020). Accounting: What the numbers mean (12th ed.). New York, NY: McGraw-Hill....