Kế toán quản trị

SWEAT GALORE
ROSELINDAWATI BINTI ZAINAL ABDIN 2010169575

ANSWERS

1. Do you think it was important for Michael to stipulate that he wanted a business that he would enjoy, that would give back to the community, that would grow and be more successful every year, and that would generate a net income of $25,000 annually? Why or why not?
It's always important to set goals to measure the success of any business. However, the first three goals are more of a mission statement while the fourth is an objective for the company. The problem is there no plan and one objective. What is he going to do if the company doesn't net the $25,000? Or what if it nets the $25,000 but there is not enough cash to sustain the business? There need to be more objectives to make allowances for these types of situations. There needs to be a plan of action where goals change from period to period. Otherwise, the business cannot succeed.

1

SWEAT GALORE
ROSELINDAWATI BINTI ZAINAL ABDIN 2010169575

2. If Michael has sales of $12,000 during January of his first year of business, determine the amount of variable and fixed costs associated with utilities and maintenance using the high-low method for each.

Hi-Lo Maintenance
September
January
Difference
Cost/unit

Units
8,000
2,000
6,000

Cost
$1,914.00
$1,716.00
$198.00
$0.03

Hi-Lo Utilities
September
January
Difference
Cost/Unit

Units
8,000
2000
6,000

Cost
$1,400.00
$1,100.00
$300.00
$0.05

January Sales
January /unit cost
January Units

12000
16
750

Maintenance Cost January

Utilities Cost January

Units
Cost/unit
Total Variable
Costs
Units
Cost/Unit
Total Variable
Costs

750
$0.03
$24.75
750
$0.05
$37.50

2

SWEAT GALORE
ROSELINDAWATI BINTI ZAINAL ABDIN 2010169575

3. Using the format below, prepare a Sales Budget for the year ending 2008.
SWEATS GALORE
Sales Budget
For the Year Ending December 31, 2008
Quarter
1

3

4

Year

8 000