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Instructions

ACCT 346
Student Name
Bravo Baking Company began operations in May of 2010 with the production and sales of specialty breads.
The company has experienced a good market demand for its high protein, low carbohydrate product called "Hi-Lo"
Hi-Lo's success has required that Bravo continue to make only this one product, however, Bravo's customers,
the local retailers, have been asking for more specialty breads from the company. The decision to expand will be made
in the coming weeks.
Weekly Assignments: Complete the assigned Tab each week.
In each worksheet there are several Green colored cells. These cells must be filled in with your response.
	Due	Points Available	Points Earned
Tab1) Product vs. Period Costs	Week 1	10	0.00
Tab 2) Cost of Goods Manufactured Schedule	Week 2	30	0.00
Tab 3) Break Even Analysis	Week 3	40	0.00
Tab 4) Incremental Analysis	Week 5	40	0.00
Tab 5) Capital Budgeting	Week 6	40	0.00
Tab 6) Variance Analysis	Week 7	40	0.00
		200	0.00	Total

Tab 1 ProductPeriod

ACCT 346
Student Name
For Tables A : From the list below, identify if the cost item is a "Product Cost" or "Period Cost" by typing "Product" or "Period" in the appropriate box.			10 points	For Table B: From the list below, identify if the cost item is a "Direct Cost" or "Indirect Cost" by typing "Direct" or "Indirect" in the appropriate box.
Table A	Enter either "Product" or "Period"			Table B	Enter either "Direct" or "Indirect"
Flour used in baking bread		0		Flour used in baking bread					0
Factory Supervisor Salaries		0		Factory Supervisor Salaries					0
Bakers wages		0		Bakers wages					0
Rent for Executive Offices		0		Factory Insurance					0
Sales Commissions		0		Rent for Factory					0
Utilities used in the factory		0		Utilities used in the factory					0
Advertising costs		0		Cleaning Bake Ovens					0
Delivery truck costs		0		Insurance on Factory					0
Paper wrappers for bread		0		Paper wrappers for bread					0
Depreciation on bake ovens		0		Depreciation on bake ovens					0
Eggs, salt, water used for baking		0		Eggs used for baking					0
Interest on bank loan		0		Small amounts of salt used					0
Factory Insurance		0		Factory Maintenance					0
		0				Points	0.00	0.00	0

Tab 2 COGM&COGS

ACCT 346

Student Name

Use the information provided below to prepare the Cost of Good Manufactured Schedule:Bravo had the following costs as of Dec 31, 2010. Enter the correct values in the Green shaded cells.

(TCO 2)

30 points

Table C

Cost of Goods Manufactured Schedule

Materials used in baking bread

Beginning Work In Process

Bakers wages

$32,000

Materials

Rent for Executive Offices

36,000

Beginning Inventory Materials

Sales Commissions

10000

Plus: Purchases

Utilities used in the factory

5000

Materials Available

Advertising costs

12000

Less: Ending Inventory Materials

Delivery truck costs

25000

Materials Used

Depreciation on bake ovens

500

Direct Labor

Interest on bank loan

250

Overhead

Beginning Inventory Materials

10,000

Factory Rent

Beginning Work in Process

8000

Depreciation on bake ovens

Ending Inventory Materials

4000

Utilities used in Factory

Inventory Purchases

26000

Other Overhead costs

Ending Work in Process

2500

Total Overhead

Other Overhead costs

1200

Total Manufacturing Costs

Beginning Finished Goods Inventory

7500

Total Work in Process

Ending Finished Goods Inventory

6000

Less: Ending Work in Process

Rent for Factory

7500

Cost of Goods Manufactured

Complete only the Green cells. Values in Red are from the schedule above.

Cost of Goods Sold Schedule

Beginning Finished Goods Inventory

Beginning Work In Process

Try Again

Materials

Beginning Inventory Materials

Try Again

Plus: Purchases

Try Again

Materials Available

Try Again

Less: Ending Inventory Materials

Try Again

Materials Used

Try Again

Direct Labor

Try Again

Overhead

Factory Rent

Try Again

Depreciation on bake ovens

Try Again

Utilities used in Factory

Try Again

Other Overhead costs

Try Again

Total Overhead

Try Again

Total Manufacturing Costs

Try Again

Total Work in Process

Try Again

Less: Ending Work in Process

Try Again

Cost of Goods Manufactured

Try Again

Goods Available for Sale

Less: Ending Finished Goods Inventory

Cost of Goods Sold Schedule

Points

0.00

Tab 3 CVP

ACCT 346
Student Name
Bravo Baking identified the costs below to determine its cost of one unit of product and its monthly operating costs. (TCO 4)				40 Points
Units produced	14,000
			Part I Enter your solution in the green cells for each of the following:
Table A	Variable	Fixed	Using the costs from Table A compute
Materials used in baking bread	2.29		A) Breakeven units (rounded to 2 decimal places)				0.00
Sales Commissions	0.12		B) Break-even sales dollars				0.00
Bakers wages	2.29		C) Contribution Margin				0.00
Rent for Executive Offices		3,000	D) Contribution Margin Ratio (enter as % for example 51% or decimal .51)				0.00
Factory Supervisor Salaries		3500
Utilities used in the factory	0.50		Part II Complete the following requirements
Advertising costs		1000	A) If Bravo requires a profit of $5,000 how many units must it sell?				0.00
Delivery truck depreciation		400	B) What is the total revenue from A above?				0.00
Depreciation on bake ovens	0.07		C) If Bravo actually sells 8,000 units (Hint: Use Break Even $ from B Above)
Interest on bank loan		500	1) What is the margin of safety in Dollars?				0.00
			2) What is the margin of safety percentage?				0.00
Total Costs	$5.27	$8,400.00
Price Charged per unit	$7.77
			Total Correct
				Points	0	0	0.00

Tab 4 Incremental Analysis

ACCT 346
Student Name
Bravo Baking Co has expanded its product line to include several other specialty breads. The operating results for the last quarter are provided below.								(TCO 7)	40 Points
Product	Hi-Lo	Whole Grain	Fruit & Nuts	Total
Revenues	$67,575	$31,800	$15,900	$115,275
Variable product costs	$27,030	$12,720	$6,360	$46,110
Variable Selling & Administrative costs	$13,515	$6,360	$3,180	$23,055
Contribution Margin	$27,030	$12,720	$6,360	$46,110
Fixed Product Costs	$5,000	$5,000	$5,000	$15,000
Fixed Selling and Administrative Costs	$5,700	$2,850	$2,850	$11,400
Allocated Common Costs	$5,000	$2,500	$2,500	$10,000
Net Income	$11,330	$2,370	($3,990)	$9,710
Required: Bravo wants to know the effect on Net Income if it decides to discontinue the Fruit & Nuts product.
If Bravo eliminates Fruit & Nuts 50% of fixed costs can be avoided.
Prepare and incremental analysis showing the Net Income Effect of eliminating the Fruit & Nuts product.
What would you advise Bravo to do?
Using the Table below, compute the Net Income for Bravo Baking after eliminating the Fruit & Nuts product.
Product	Hi-Lo	Whole Grain	Fruit & Nuts	Total
Revenues				$0	Try Again	Try Again	0
Variable product costs				$0	Try Again	Try Again	0
Variable Selling & Administrative costs				$0	Try Again	Try Again	0
Contribution Margin				$0	Try Again	Try Again	0
Fixed Product Costs				$0	Try Again	Try Again	0
Fixed Selling and Administrative Costs				$0	Try Again	Try Again	0
Allocated Common Costs				$0	Try Again	Try Again	0
Net Income				$0	Try Again	Try Again	0
				Points	0	0	0
Based on your analysis, what recommendation would you make about Fruit & Nuts? Explain.

Tab 5 Capital Budgeting

ACCT 346

Student Name

Bravo Baking Co is considering replacing an older freezer with a larger unit to freeze some of its bread.

The new unit has a larger capacity and Bravo estimates it can produce and sell more bread each year. From these additional sales

the annual after-tax cash flow is expected to be $4,000. In addition to more sales, the new freezer will save $1,200 in electricity each year.

TCO 9

However, the new freezer will cost an additional $2,000 each year for maintenance. The cost of the new unit is $25,000 and it is

40 Points

expected to last 10 years. The salvage value at the end of its life is $6,000. The old unit is fully depreciated and can be disposed at cost.

Determine the Net Present Value of purchasing the new freezer using a required rate of return of 14%. Should Bravo purchase the freezer?

Use the format below to complete the NPV computations:

Note: Use PV Tables found in the PV tabs in the workbook. Be sure to enter 4 decimal places. Also, be sure to show costs as negative values.

Cash Flow

PV Factors

PV Amounts

Cost of new refrigeration unit

After tax cash flow

Annual electricity savings

Additional annual maintenance costs

Amount collected from disposal of unit

Net present value

Points

0.00

Based on your analysis, what is your recommendation regarding the new freezer? Explain

Tab 6 Variance Analysis

ACCT 346

TCO 10

Student Name

40 Points

Bravo Baking uses standard costing to analyze its performance. The data below is provided for your use in determining Bravo's variances.

Standard Cost per unit

Cost /Unit

Amount/Unit

Standard Cost

Material Cost (Ingredients) (.5 lbs)

2.29

.5 lbs

$4.58

Direct Labor( .25 hrs * $9/hr)

2.25

.25 hrs

$9.00

Overhead

0.57

Total

5.11

During the month, Bravo sold 9,000 loaves of bread and used 4,650 pounds of ingredients. Also during the month, Bravo

purchased 5,000 pounds of ingredients at a cost of $22,500. Employees worked a total of 2200 hours and actual labor costs were $19,998

Required:

Part a. Compute the material price and quantity variance.

Material Price Variance =

= (

) *

Fav/Unf >

Material Quantity Variance =

= (

) *

Fav/Unf

Labor Rate Variance =

= (

) *

Fav/Unf >

Labor Efficiency Variance =

= (

) *

Fav/Unf

Points

PV of $1

Start Rate	1.00%			Rate	1.00%
Step Rate By	1.00%			Period	1
Start Period	1.00
Step Period by	1.00
Rows	60.00
Columns	15.00
Present Value of $1 to be Received at the End of N Periods (PVIF)
0.9900990099009901	1.00%	2.00%	3.00%	4.00%	5.00%	6.00%	7.00%	8.00%	9.00%	10.00%	11.00%	12.00%	13.00%	14.00%	15.00%
1.00	0.9901	0.9804	0.9709	0.9615	0.9524	0.9434	0.9346	0.9259	0.9174	0.9091	0.9009	0.8929	0.8850	0.8772	0.8696
2.00	0.9803	0.9612	0.9426	0.9246	0.9070	0.8900	0.8734	0.8573	0.8417	0.8264	0.8116	0.7972	0.7831	0.7695	0.7561
3.00	0.9706	0.9423	0.9151	0.8890	0.8638	0.8396	0.8163	0.7938	0.7722	0.7513	0.7312	0.7118	0.6931	0.6750	0.6575
4.00	0.9610	0.9238	0.8885	0.8548	0.8227	0.7921	0.7629	0.7350	0.7084	0.6830	0.6587	0.6355	0.6133	0.5921	0.5718
5.00	0.9515	0.9057	0.8626	0.8219	0.7835	0.7473	0.7130	0.6806	0.6499	0.6209	0.5935	0.5674	0.5428	0.5194	0.4972
6.00	0.9420	0.8880	0.8375	0.7903	0.7462	0.7050	0.6663	0.6302	0.5963	0.5645	0.5346	0.5066	0.4803	0.4556	0.4323
7.00	0.9327	0.8706	0.8131	0.7599	0.7107	0.6651	0.6227	0.5835	0.5470	0.5132	0.4817	0.4523	0.4251	0.3996	0.3759
8.00	0.9235	0.8535	0.7894	0.7307	0.6768	0.6274	0.5820	0.5403	0.5019	0.4665	0.4339	0.4039	0.3762	0.3506	0.3269
9.00	0.9143	0.8368	0.7664	0.7026	0.6446	0.5919	0.5439	0.5002	0.4604	0.4241	0.3909	0.3606	0.3329	0.3075	0.2843
10.00	0.9053	0.8203	0.7441	0.6756	0.6139	0.5584	0.5083	0.4632	0.4224	0.3855	0.3522	0.3220	0.2946	0.2697	0.2472
11.00	0.8963	0.8043	0.7224	0.6496	0.5847	0.5268	0.4751	0.4289	0.3875	0.3505	0.3173	0.2875	0.2607	0.2366	0.2149
12.00	0.8874	0.7885	0.7014	0.6246	0.5568	0.4970	0.4440	0.3971	0.3555	0.3186	0.2858	0.2567	0.2307	0.2076	0.1869
13.00	0.8787	0.7730	0.6810	0.6006	0.5303	0.4688	0.4150	0.3677	0.3262	0.2897	0.2575	0.2292	0.2042	0.1821	0.1625
14.00	0.8700	0.7579	0.6611	0.5775	0.5051	0.4423	0.3878	0.3405	0.2992	0.2633	0.2320	0.2046	0.1807	0.1597	0.1413
15.00	0.8613	0.7430	0.6419	0.5553	0.4810	0.4173	0.3624	0.3152	0.2745	0.2394	0.2090	0.1827	0.1599	0.1401	0.1229
16.00	0.8528	0.7284	0.6232	0.5339	0.4581	0.3936	0.3387	0.2919	0.2519	0.2176	0.1883	0.1631	0.1415	0.1229	0.1069
17.00	0.8444	0.7142	0.6050	0.5134	0.4363	0.3714	0.3166	0.2703	0.2311	0.1978	0.1696	0.1456	0.1252	0.1078	0.0929
18.00	0.8360	0.7002	0.5874	0.4936	0.4155	0.3503	0.2959	0.2502	0.2120	0.1799	0.1528	0.1300	0.1108	0.0946	0.0808
19.00	0.8277	0.6864	0.5703	0.4746	0.3957	0.3305	0.2765	0.2317	0.1945	0.1635	0.1377	0.1161	0.0981	0.0829	0.0703
20.00	0.8195	0.6730	0.5537	0.4564	0.3769	0.3118	0.2584	0.2145	0.1784	0.1486	0.1240	0.1037	0.0868	0.0728	0.0611
21.00	0.8114	0.6598	0.5375	0.4388	0.3589	0.2942	0.2415	0.1987	0.1637	0.1351	0.1117	0.0926	0.0768	0.0638	0.0531
22.00	0.8034	0.6468	0.5219	0.4220	0.3418	0.2775	0.2257	0.1839	0.1502	0.1228	0.1007	0.0826	0.0680	0.0560	0.0462
23.00	0.7954	0.6342	0.5067	0.4057	0.3256	0.2618	0.2109	0.1703	0.1378	0.1117	0.0907	0.0738	0.0601	0.0491	0.0402
24.00	0.7876	0.6217	0.4919	0.3901	0.3101	0.2470	0.1971	0.1577	0.1264	0.1015	0.0817	0.0659	0.0532	0.0431	0.0349
25.00	0.7798	0.6095	0.4776	0.3751	0.2953	0.2330	0.1842	0.1460	0.1160	0.0923	0.0736	0.0588	0.0471	0.0378	0.0304
26.00	0.7720	0.5976	0.4637	0.3607	0.2812	0.2198	0.1722	0.1352	0.1064	0.0839	0.0663	0.0525	0.0417	0.0331	0.0264
27.00	0.7644	0.5859	0.4502	0.3468	0.2678	0.2074	0.1609	0.1252	0.0976	0.0763	0.0597	0.0469	0.0369	0.0291	0.0230
28.00	0.7568	0.5744	0.4371	0.3335	0.2551	0.1956	0.1504	0.1159	0.0895	0.0693	0.0538	0.0419	0.0326	0.0255	0.0200
29.00	0.7493	0.5631	0.4243	0.3207	0.2429	0.1846	0.1406	0.1073	0.0822	0.0630	0.0485	0.0374	0.0289	0.0224	0.0174
30.00	0.7419	0.5521	0.4120	0.3083	0.2314	0.1741	0.1314	0.0994	0.0754	0.0573	0.0437	0.0334	0.0256	0.0196	0.0151
31.00	0.7346	0.5412	0.4000	0.2965	0.2204	0.1643	0.1228	0.0920	0.0691	0.0521	0.0394	0.0298	0.0226	0.0172	0.0131
32.00	0.7273	0.5306	0.3883	0.2851	0.2099	0.1550	0.1147	0.0852	0.0634	0.0474	0.0355	0.0266	0.0200	0.0151	0.0114
33.00	0.7201	0.5202	0.3770	0.2741	0.1999	0.1462	0.1072	0.0789	0.0582	0.0431	0.0319	0.0238	0.0177	0.0132	0.0099
34.00	0.7130	0.5100	0.3660	0.2636	0.1904	0.1379	0.1002	0.0730	0.0534	0.0391	0.0288	0.0212	0.0157	0.0116	0.0086

PV of Annuity

Start Rate	1.00%			Rate	1.00%
Step Rate By	1.00%			Period	0
Start Period	1.00
Step Period by	1.00
Rows	60.00
Columns	15.00
Type	Regular
Present Value of an Annuity of $1 per Period for N Periods (PVIFA)
0.0	1.00%	2.00%	3.00%	4.00%	5.00%	6.00%	7.00%	8.00%	9.00%	10.00%	11.00%	12.00%	13.00%	14.00%	15.00%
1.00	0.9901	0.9804	0.9709	0.9615	0.9524	0.9434	0.9346	0.9259	0.9174	0.9091	0.9009	0.8929	0.8850	0.8772	0.8696
2.00	1.9704	1.9416	1.9135	1.8861	1.8594	1.8334	1.8080	1.7833	1.7591	1.7355	1.7125	1.6901	1.6681	1.6467	1.6257
3.00	2.9410	2.8839	2.8286	2.7751	2.7232	2.6730	2.6243	2.5771	2.5313	2.4869	2.4437	2.4018	2.3612	2.3216	2.2832
4.00	3.9020	3.8077	3.7171	3.6299	3.5460	3.4651	3.3872	3.3121	3.2397	3.1699	3.1024	3.0373	2.9745	2.9137	2.8550
5.00	4.8534	4.7135	4.5797	4.4518	4.3295	4.2124	4.1002	3.9927	3.8897	3.7908	3.6959	3.6048	3.5172	3.4331	3.3522
6.00	5.7955	5.6014	5.4172	5.2421	5.0757	4.9173	4.7665	4.6229	4.4859	4.3553	4.2305	4.1114	3.9975	3.8887	3.7845
7.00	6.7282	6.4720	6.2303	6.0021	5.7864	5.5824	5.3893	5.2064	5.0330	4.8684	4.7122	4.5638	4.4226	4.2883	4.1604
8.00	7.6517	7.3255	7.0197	6.7327	6.4632	6.2098	5.9713	5.7466	5.5348	5.3349	5.1461	4.9676	4.7988	4.6389	4.4873
9.00	8.5660	8.1622	7.7861	7.4353	7.1078	6.8017	6.5152	6.2469	5.9952	5.7590	5.5370	5.3282	5.1317	4.9464	4.7716
10.00	9.4713	8.9826	8.5302	8.1109	7.7217	7.3601	7.0236	6.7101	6.4177	6.1446	5.8892	5.6502	5.4262	5.2161	5.0188
11.00	10.3676	9.7868	9.2526	8.7605	8.3064	7.8869	7.4987	7.1390	6.8052	6.4951	6.2065	5.9377	5.6869	5.4527	5.2337
12.00	11.2551	10.5753	9.9540	9.3851	8.8633	8.3838	7.9427	7.5361	7.1607	6.8137	6.4924	6.1944	5.9176	5.6603	5.4206
13.00	12.1337	11.3484	10.6350	9.9856	9.3936	8.8527	8.3577	7.9038	7.4869	7.1034	6.7499	6.4235	6.1218	5.8424	5.5831
14.00	13.0037	12.1062	11.2961	10.5631	9.8986	9.2950	8.7455	8.2442	7.7862	7.3667	6.9819	6.6282	6.3025	6.0021	5.7245
15.00	13.8651	12.8493	11.9379	11.1184	10.3797	9.7122	9.1079	8.5595	8.0607	7.6061	7.1909	6.8109	6.4624	6.1422	5.8474
16.00	14.7179	13.5777	12.5611	11.6523	10.8378	10.1059	9.4466	8.8514	8.3126	7.8237	7.3792	6.9740	6.6039	6.2651	5.9542
17.00	15.5623	14.2919	13.1661	12.1657	11.2741	10.4773	9.7632	9.1216	8.5436	8.0216	7.5488	7.1196	6.7291	6.3729	6.0472
18.00	16.3983	14.9920	13.7535	12.6593	11.6896	10.8276	10.0591	9.3719	8.7556	8.2014	7.7016	7.2497	6.8399	6.4674	6.1280
19.00	17.2260	15.6785	14.3238	13.1339	12.0853	11.1581	10.3356	9.6036	8.9501	8.3649	7.8393	7.3658	6.9380	6.5504	6.1982
20.00	18.0456	16.3514	14.8775	13.5903	12.4622	11.4699	10.5940	9.8181	9.1285	8.5136	7.9633	7.4694	7.0248	6.6231	6.2593