Milestone One

Overview

Successful entrepreneurs understand all aspects of business, especially costs and costing systems. In the course project, you will assume the role of the owner of a small business. Apply managerial accounting principles to evaluate and manage costs related to your products and services within a costing system. In the first milestone of the project, you will determine and classify the costs necessary for opening your business.

Scenario

You plan to open a business manufacturing collars, leashes, and harnesses for pets. To begin, you will manufacture these in a standard style and size with plans to expand your range over the year. In a few weeks, you will present your companys financial strategy to some key investors. To begin creating your strategy, you must consider and record all the costs associated with operating your business. You have decided to use the job order costing system.

Directions

Use the given operational costs provided in the Milestone One Operational Costs Data Appendix, linked in the Supporting Materials section, to complete the first two tabs, Cost Classification and Variable and Fixed Costs, in the Project Workbook, linked in the What to Submit section below.

Specifically, you must address the following rubric criteria:

• Cost Classification: Accurately classify all your costs in the Cost Classification tab of your workbook.
• Identify direct material, direct labor, overhead, and period costs. Note: Fixed and variable costs have been classified for you.
• Variable and Fixed Costs: Complete the Variable and Fixed Costs tab of your workbook. Note: Some costs are provided for you. Fill in only the missing costs.
• Determine your total variable cost per unit and the total fixed costs for each product. Show your work using calculations to the side of the table or using appropriate formulas in the table.

What to Submit

Submit the with the Cost Classification and Fixed and Variable Costs tabs completed. This file should be completed and submitted using Microsoft Excel.

Supporting Materials

The following resource supports your work on this assignment:

Reading:

Milestone One Rubric

CriteriaExceeds Expectations (100%)Meets Expectations (85%)Partially Meets Expectations (55%)Does Not Meet Expectations (0%)ValueCosts ClassificationClassifies all costs, including direct material, direct labor, overhead, and period costs, with no errorsClassifies all costs, including direct material, direct labor, overhead, and period costs, with minimal errorsClassifies all costs, including direct material, direct labor, overhead, and period costs, with significant errorsDoes not attempt criterion25Variable and Fixed Costs: CollarsDetermines the per unit cost and the fixed costs for collars, with no errors; shows work through calculations or formulasDetermines the per unit cost and the fixed costs for collars, with minimal errorsDetermines the per unit cost and the fixed costs for collars, with significant errorsDoes not attempt criterion25Variable and Fixed Costs: LeashesDetermines the per unit cost and the fixed costs for leashes, with no errors; shows work through calculations or formulasDetermines the per unit cost and the fixed costs for leashes, with minimal errorsDetermines the per unit cost and the fixed costs for leashes, with significant errorsDoes not attempt criterion25Variable and Fixed Costs: HarnessesDetermines the per unit cost and the fixed costs for harnesses, with no errors; shows work through calculations or formulasDetermines the per unit cost and the fixed costs for harnesses, with minimal errorsDetermines the per unit cost and the fixed costs for harnesses, with significant errorsDoes not attempt criterion25Total:100% LINKS: https://youtu.be/DBVvFhWK004 https://youtu.be/DBVvFhWK004