Share
Explore BrainMass

Cakes and cookies: Prepare a Balance Sheet, Income Statement, Cost of Goods Manufactured Schedule and Cost of Goods Sold Schedule.

Exercise Summary:

You have $10,000 budget per month. You are required to spend as much as possible. The cost of rent is $1,000 per month. Please make-up your own amounts for utilities and other business expenses.

For starters, you will need to find three of your favorite cake or cookie recipes. Using these recipes, you will brainstorm on the different stages involved in manufacturing cakes or cookies. Determine the basic stages and requirements for cake manufacturing. You will then manufacture the cakes and cookies and report on the flow of costs in the manufacturing process (NOTE: You can complete this activity by visualizing the cake manufacturing process and recording each aspect as you envision it. This may mean a trip to the local grocery store to ascertain the costs of your envisioned materials and supplies.)

Exercise Outcome
When you have completed the manufacturing activity, you should have a better comprehension of the three key components of manufacturing costs (direct material, direct labor, manufacturing overhead) and how these costs flow through a manufacturing process. Based on your manufacturing of the cakes, you should be able to analyze the costs that were incurred or added at each stage of the process and prepare a report that explains the cost flow and total costs of the cakes manufactured. Prepare a raw materials list, including quantities and cost. What would be a good price for each cake or cookie?

(The tables below must be completed)

RAW MATERIALS
Quantity Description Unit Cost Total Cost

DIRECT LABOR
Quantity Description Unit Cost Total Cost

OVERHEAD
Quantity Description Unit Cost Total Cost

1. Include the three recipes used.
2. Prepare a Balance Sheet, Income Statement, Cost of Goods Manufactured Schedule and Cost
of Goods Sold Schedule.
3. Provide sample flowcharts illustrating each process.

Solution Summary

You will find the answer to this puzzling question inside...

$2.19