Overview: In the third milestone, you will jump forward in time: Imagine that yo

Question

Overview: In the third milestone, you will jump forward in time: Imagine that your business has already opened. Use the updated scenario information to analyze your company's performance. they require board meetings for status updates on the company's Post-opening Scenario: Your angel investors are silent in relation to the business financial health. Therefore, you need to analyze your company's performance over the last month using the data provided below ructor will reate an announcement sharing the income statement data by the end of Module Four. All of the data you need for the cost-of goods-manufactured statement can be found in the "COGM Schedule tab of your workbook For your variance analysis, use the following financial data Actual Rate 11.50 Actual Price $3 Actual Hours Standard Hours 150 Standard Quantity 1000 Standard Rate $12 Standard Price $2 Grooming labor Grooming Materials Actual Quantity 1200 Prompt: Complete your work in the provided workbook by assessing your company's financial performance, specifically addressing the following critical elements Financial Statements o Create a statement of cost of goods manufactured in the COGM Schedule tab. o Create an income statement in the "Income Statement" tab Activate Windows o to Pg settings to activ . Variance Analysis o Identify all variances for the direct labor time and the materials price in the Variances" tab. o Evaluate the significance of the variances in the "Variances" tab.

Explanation / Answer

Statement of Cost of Goods Manufactured For the month of January Beginning work in progress                         -   Direct Materials Materials - Beginning Inventory Add: Purchases during January            5,000.00 Deduct: Ending Materials (60%)            3,000.00 Materials used in production            2,000.00 Direct Labor            6,240.00 Factory Overhead            2,800.00 Total Manufacturing OH          11,040.00 Deduct: Ending Work in Progress                         -   Cost of Goods Manufactured          11,040.00 Sales Revenue Grooming Daycare Boarding Sales Price per unit 25 18 25 No of units per day 4 22 12 No of Days 30 30 30 Sales Revenue 3000 11880 9000 Income Statement Revenue Grooming            3,000.00 Day Care          11,880.00 Boarding            9,000.00    23,880.00 Cost of Goods sold    11,040.00 Gross Profit    12,840.00 G & A Salaries            1,200.00 Advertising                100.00 Cleaning Products                120.00 Depreciation                  83.00 Tax Expense                         -   Rent                650.00 Loan                420.00 Utilities and Insurance                600.00 Total Expense      3,173.00 Net Income/(Loss)      9,667.00 Variances Groomer Direct Labor Time Variance DL Time Variance (AH-SH) x SR (180-150)*12 360 Unfavorable Hours needed for grooming the same number of dogs is more than budget. Hence the variance is unfavourable Groomer Direct Labor Rate Variance DL Rate Variance (AR-SR) x AH (11.50-12)*180 -90 Favorable Actual rate is lower than standard rate. This will result in savings increasing the income. Hence variance is favorable Direct Materials Efficiency DM Quantity Variance (AQ - SQ) x SP (1200-1000)*2 400 Unfavorable Quantity needed is more than standard resulating in loss of income. Hence variance is unfavorable Direct Materials Price Variance DM Price Variance (AP-SP) x AQ (3-2)*1200 1200 Unfavorable Rate of DM is more than the standard resulting in loss of income. Hence variance is unfavorable

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