You will create a report based on the premise that you want to establish a cookie business that sells only one type of s

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You will create a report based on the premise that you want to
establish a cookie business that sells only one type of specialty
cookie with two employees. Your report will provide the following
information: • Introduction (Part 1) o Create a name and establish
a locale for the business. o Construct a mission statement. o
Decide on the type of cookie you want to sell. • Costing and Sales
Information, Production of 1,000 cookies (Part 2) o Estimate and
explain the costs per cookie based on job order costing. Prepare a
job order cost sheet by researching the pricing for these top five
ingredients: butter, sugar, vanilla, flour, chips/add-ins. ▪
Manufacturing overhead is 30% of direct labor costs. ▪ It will take
two employees working two days to make 1,000 cookies. o For process
costing, you will examine the costs per 1,000 cookies looking at
these top three processes (departments): Mixing, Add-ins, and
Packaging. ▪ The Mixing Department will be examined in depth. •
Materials will be added at the beginning of the process. • The
cookies will be in the Mixing Department for a total of eight
hours; however, the cookies will only be 40% complete before they
are transferred to the Add-ins Department. (Use this % for
conversion costs.) o Using the job-order costing system, determine
the costs and sales price of your cookies. • Differences between
two-process cost systems (Part 3) o Compare and contrast the cost
methods examined in this project. Discuss using the information
created, which costing method in this example, gives more complete
costing information, and why. o Discuss product costs and
conversion costs and their importance in both costing systems. •
Variances in production – Costs and Revenues (Part 4) o Examine the
variances in both the job order costing and process costing (for
the Mixing Department only) systems if the number of your cookies
was to decrease to 500 cookies or increase to 1,500 cookies. o
Examine the effect on revenue these two variances in production
would have. • Conclusion (Part 5)