Excel Workbook
1
ACC 202 Milestone Three: Actual Costs and Revenue Data Appendix
At the end of the first month of opening your business, you calculate the actual operating costs of the
business and the income you earned. You also notice and document the difference in what you
budgeted for certain materials and labor against the actual amounts you spent on the same.
For your statement of cost of goods sold, use the following data regarding the actual costs incurred by
the business over the past month:
• Materials purchased: $20,000
o Consumed 80% of the purchased materials
• Direct labor: $8,493.33
• Overhead costs: $3,765
Note: Assume that the beginning materials and ending work in process are zero for the month.
Use the following revenue and cost information for the income statement. Note that the revenue you
use will depend on the pricing level options you chose in Milestone Two. Also, assume that after
accounting for weekends and other holidays, there were 20 business days in the first month of
operation. For example, if you chose a sales price of $20 per collar, the actual number of collars sold in
the month was 33 per day or 33 x 20 = 660 per month.
Established Sales
Price
Number of Items Sold per
Day
Collars
$20 33
$24 28
$28 23
Leashes
$22 28
$26 23
$30 18
Harnesses
$25 25
$30 22
$35 20
The other costs incurred by the business include:
• General and administrative salaries
o Receptionist: $1,950
o Owner salary: $500
• Depreciation: $165
• Rent: $750
• Utilities and insurance: $600
• Scissors, thread, and cording: $1,200
• Loan repayment: $5502
Variance
At the end of the month, you find that the labor and materials spent on manufacturing collars was
different from what you estimated:
• The collar maker had to work nine hours a day instead of eight due to an increased demand for
collars.
• Because of the increased demand, the hourly rate you paid your employee for making the
collars increased to $16.50.
• An increase in the cost of raw material led the direct material cost per collar to increase to $10.
• However, you also made and sold 60 more collars than you expected to sell in the month.
You now need to determine the variance in the materials and labor cost from what you estimated in
Milestone Two based on the market research data
