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Written Assignment Unit01

The proposed estimate of a product (costing) depends on the type of products a business produces and the amount of effort that goes into analyzing the costs associated with the unit product, the process and activity. The business therefore links the cost of production of a product with the desired rate of return for those efforts. The three costing methods to be discussed are the Job order costing, process costing and activity based costing which have their own methods, benefits and drawbacks.

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Michael Aboelkhair
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90 views

Written Assignment Unit01

The proposed estimate of a product (costing) depends on the type of products a business produces and the amount of effort that goes into analyzing the costs associated with the unit product, the process and activity. The business therefore links the cost of production of a product with the desired rate of return for those efforts. The three costing methods to be discussed are the Job order costing, process costing and activity based costing which have their own methods, benefits and drawbacks.

Uploaded by

Michael Aboelkhair
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Polly’s Pet Products

Unit 1 Written Assignment

Submitted to
Robert Amoah (Instructor)
Course Code: BUS 5110
Course Title: Managerial Accounting
Program: MBA
Session: AY2022-T3

Date of Submission: February 02, 2022


Introduction

This assignment is based on the excel file of (Polly's Pet Products, 2018). Here I am writing the

results of the blank lines from the excel file. Also, I am going to show the process how I calculated the

results and definition of those processes. Another thing I want to mention that, as this assignment is on a

specific case and calculation, so there is no references other than the excel file of (Polly's Pet Products,

2018).

Results and Definition of process

Balance Sheet

Polly's Pet Products

Balance Sheet as of December 31, 2018

ASSETS

CURRENT ASSETS

Cash 31,500
Accounts receivable 50,000
Other assets 25,000

Total current assets 106,500

LONG TERM ASSETS

Fixed Assets 75,000

TOTAL ASSETS 181,500

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES

Accounts payable 75,000


Accrued expenses 30,000
Income tax payable 5,000
Current portion of notes payable 12,000
Deferred income taxes 1,500

Total current liabilities 123,500

LONG TERM LIABILITIES


Notes payable (long term) 38,000

TOTAL LIABILITIES 161,500

STOCKHOLDERS' EQUITY

Common stock 5,000


Additional paid-in capital 15,000

Retained Earnings 20,000

Total stockholders' equity 20,000

TOTAL LIABILITIES AND STOCKHOLDERS


EQUITY 181,500

Process of my calculation

1. I put a formula (=B40+B41) at B43 to get the value of Retained earnings, then put the value at C45 to

get Total stockholders' equity.

2. At C47 I wrote the formula (=C36+C45) to get the summation of TOTAL LIABILITIES AND

STOCKHOLDERS EQUITY from C36 and C45.

3. From C47, I put the same value at C19 as we know Asset=Equity+Liabilities.

4. By Deducting Fixed Assets $75,000 (cell C17) from Total Assets $181,500 (cell C19), I got the value

of Total current assets $106,500 at C13.

5. At cell C9 I created the formula (=C13-(C10+C11)) to get the value of Cash. It deducted Accounts

receivable and Other assets from Total current assets and I got $31,500 as Cash.

Income Statement
Polly's Pet Products

Income Statement as of December 31, 2018

Revenues 650,000

Operating Costs 445,000

Gross Profit 205,000

General and Administrative Expenses 75,000

Operating Income 130,000

Other Expense 60,000

Income Before Provision for Income Taxes 70,000

Provision for Income Taxes 5,000

Net Income 65,000

Retained Earnings, Beginning Balance 103,500

Net Income 65,000

Retained Earnings, Ending Balance 168,500

Process of my calculation

1. At B8 I wrote formula (=B6-B10) to get Operating Costs, and that is $445,000

2. By subtracting General and Administrative Expenses (B12) from Gross Profit (B10) I got

Operating Income $130,000 at B14


3. I wrote the formula (=B14-B16) at B18 and got the amount of Income Before Provision for Income

Taxes $70,000. Then after subtracting Provision for Income Taxes $5000 from that, I got Net Income

$65,000 at B22

4. Finally in the Income Statement, got the Retained Earnings, Ending Balance $168,500 at B29.

Statement of Cash Flows

Polly's Pet Products

Statement of Cash Flows as of


December 31, 2018

Cash Flows from Operating Activities

Cash received from customers 600,000

Cash paid out to suppliers and employees (400,000)

Interest paid (5,000)

Taxes paid (10,000)


Net cash provided by operating
activities 185,000

Cash Flows from Investing Activities

Purchase of fixed assets (25,000)


Net cash used in investing
activities (25,000)

Cash Flows from Financing Activities

New loans 50,000

Repayments on loans (45,000)

Issuance of common shares of stock 5,000


Net cash provided by financing
activities 10,000

Net change in Cash 170,000

Cash balance, beginning of year 30,000


Cash balance, end of year 200,000

Process of my calculation

1. I wrote a formula (=D10-C6-C8-C9) at C7 and got the value of Cash paid out to suppliers and

employees: $400,000.

2. By writing the formula (=C17+C18+C19) at D20 I got the value of Net cash provided by financing

activities $10,000.

3. Putting this formula (=D10+D14+D20) at D22 I got the amount of Net change in Cash and that is

$170,000.

4. Adding the Net change in Cash (D22) and Cash balance, beginning of year (D24) I got the amount

of Cash balance, end of year $200,000.

Conclusion

The company’s performance is good. We can see the Retained Earnings, Beginning Balance was $103,500,

and the Retained Earnings, Ending Balance is $168,500; that means increased $65,000. Also, the cash

balance of beginning of the year was only $30,000 but the Cash balance at end of year is $200,000. That

means increased $170,000.

References

Polly's Pet Products. (2018, December 31). Retrieved from

https://my.uopeople.edu/pluginfile.php/1551828/mod_workshop/instructauthors/5110U1-Financial.xlsx

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