CASE 2 APPENDIX C BANNER MANUFACTURING INC. OPERATING DATA PRODUCT X PRODUCT Y – – PRICE $66 $82…

CASE 2

APPENDIX C

BANNER MANUFACTURING INC.

OPERATING DATA

PRODUCT X

PRODUCT Y

–

–

PRICE

$66

$82

DIRECT MATERIALS

QUANTITY
RATE
UNIT COST

QUANTITY
RATE
UNIT COST

–

–
———–

–
———
———-

DIR. MAT.(A)
5
LBS./UNIT@
$2
$10

6
LBS/UNIT@
$2
$12

DIR. MAT.(B)
0
LBS./UNIT@
$3
$0

1
LBS/UNIT@
$3
$3

DIRECT LABOR

–

CUTTING DEPT.
1
HR/UNIT @
$10
$10

1
HR/UNIT @
$10
$10

ASSEMBLY DEPT.
1
HR/UNIT @
$10
$10

1.50
HR/UNIT @
$10
$15

|::

CASE 2

PRODUCT X

–

JAN
FEB
MAR
APR
MAY
JUN
JULY
AUG
SEP
OCT
NOV
DEC
TOTAL

–
–
–
–
–
–
–
–
–
–
–
–
–

QUT.SOLD
13,050
12,650
12,250
11,850
11,450
11,050
10,650
10,250
9,850
9,450
9,050
8,650
130,200

–
–
–
–
–
–
–
–
–
–
–
–
–

QUT. PRODUCED
13,050
12,650
12,250
11,850
11,450
11,050
10,650
10,250
9,850
9,450
9,050
19,150
140,700

–
–
–
–
–
–
–
–
–
–
–
–
–

SALES
861,300
834,900
808,500
782,100
755,700
729,300
702,900
676,500
650,100
623,700
597,300
570,900
8,593,200

SALES DISCOUNT
8,613
8,349
8,085
7,821
7,557
7,293
7,029
6,765
6,501
6,237
5,973
5,709
85,932

–
–
–
–
–
–
–
–
–
–
–
–
–

NET SALES
852,687
826,551
800,415
774,279
748,143
722,007
695,871
669,735
643,599
617,463
591,327
565,191
8,507,268

=
=
=
=
=
=
=
=
=
=
=
=
=

PRODUCT Y

–

JAN
FEB
MAR
APR
MAY
JUN
JULY
AUG
SEP
OCT
NOV
DEC
TOTAL

–
–
–
–
–
–
–
–
–
–
–
–
–

QUT.SOLD
16,000
16,100
16,200
16,300
16,400
16,500
16,600
16,700
16,800
16,900
17,000
17,100
198,600

–
–
–
–
–
–
–
–
–
–
–
–
–

QUT.PRODUCED
16,000
16,100
16,200
16,300
16,400
16,500
16,600
16,700
16,800
16,900
17,000
29,100
210,600

–
–
–
–
–
–
–
–
–
–
–
–
–

SALES
1,312,000
1,320,200
1,328,400
1,336,600
1,344,800
1,353,000
1,361,200
1,369,400
1,377,600
1,385,800
1,394,000
1,402,200
16,285,200

SALES DISCOUNT
13,120
13,202
13,284
13,366
13,448
13,530
13,612
13,694
13,776
13,858
13,940
14,022
162,852

–
–
–
–
–
–
–
–
–
–
–
–
–

NET SALES
1,298,880
1,306,998
1,315,116
1,323,234
1,331,352
1,339,470
1,347,588
1,355,706
1,363,824
1,371,942
1,380,060
1,388,178
16,122,348

=
=
=
=
=
=
=
=
=
=
=
=
=

PRODUCT X&Y

–

GROSS SALES
2,173,300
2,155,100
2,136,900
2,118,700
2,100,500
2,082,300
2,064,100
2,045,900
2,027,700
2,009,500
1,991,300
1,973,100
24,878,400

SALES DISCOUNT
21,733
21,551
21,369
21,187
21,005
20,823
20,641
20,459
20,277
20,095
19,913
19,731
248,784

–
–
–
–
–
–
–
–
–
–
–
–
–

NET SALES
2,151,567
2,133,549
2,115,531
2,097,513
2,079,495
2,061,477
2,043,459
2,025,441
2,007,423
1,989,405
1,971,387
1,953,369
24,629,616

=
=
=
=
=
=
=
=
=
=
=
=
=

APPENDIX D

BANNER MANUFACTURING INC.

COMPARATIVE INCOME
STATEMENTS FOR YEAR ENDED
01/01/2013

JAN
FEB
MAR
APR
MAY
JUN
JULY
AUG
SEP
OCT
NOV
DEC
TOTAL

NET SALES
2,151,567
2,133,549
2,115,531
2,097,513
2,079,495
2,061,477
2,043,459
2,025,441
2,007,423
1,989,405
1,971,387
1,953,369
24,629,616

=
=
=
=
=
=
=
=
=
=
=
=
=

DM(PROD.X)
130,500
126,500
122,500
118,500
114,500
110,500
106,500
102,500
98,500
94,500
90,500
191,500
1,407,000

DM(PROD.Y)
240,000
241,500
243,000
244,500
246,000
247,500
249,000
250,500
252,000
253,500
255,000
436,500
3,159,000

–
–
–
–
–
–
–
–
–
–
–
–
–

TOTAL DM
370,500
368,000
365,500
363,000
360,500
358,000
355,500
353,000
350,500
348,000
345,500
628,000
4,566,000

=
=
=
=
=
=
=
=
=
=
=
=
=

DL(PROD.X)
261,000
253,000
245,000
237,000
229,000
221,000
213,000
205,000
197,000
189,000
181,000
383,000
2,814,000

DL(PROD.Y)
400,000
402,500
405,000
407,500
410,000
412,500
415,000
417,500
420,000
422,500
425,000
727,500
5,265,000

–
–
–
–
–
–
–
–
–
–
–
–
–

TOTAL DL
661,000
655,500
650,000
644,500
639,000
633,500
628,000
622,500
617,000
611,500
606,000
1,110,500
8,079,000

=
=
=
=
=
=
=
=
=
=
=
=
=

TOTAL OH
364,400
362,200
360,000
357,800
355,600
403,400
351,200
349,000
346,800
344,600
342,400
544,200
4,481,600

–
–
–
–
–
–
–
–
–
–
–
–
–

MFG.COST
1,395,900
1,385,700
1,375,500
1,365,300
1,355,100
1,394,900
1,334,700
1,324,500
1,314,300
1,304,100
1,293,900
2,282,700
17,126,600

BEG. INVENTORY
0
0
0
0
0
0
0
0
0
0
0
0
0

END. INVENTORY.
0
0
0
0
0
0
0
0
0
0
0
-1,047,034
-1,047,034

–
–
–
–
–
–
–
–
–
–
–
–
–

COST OF GOODS SOLD
1,395,900
1,385,700
1,375,500
1,365,300
1,355,100
1,394,900
1,334,700
1,324,500
1,314,300
1,304,100
1,293,900
1,235,666
16,079,566

–
–
–
–
–
–
–
–
–
–
–
–
–

GROSS PROFIT
755,667
747,849
740,031
732,213
724,395
666,577
708,759
700,941
693,123
685,305
677,487
717,703
8,550,050

=
=
=
=
=
=
=
=
=
=
=
=
=

ADVERTISING
217,330
217,330
215,510
213,690
211,870
210,050
208,230
206,410
204,590
202,770
200,950
199,130
2,507,860

SALARY & COM.
186,932
186,204
185,476
184,748
184,020
183,292
182,564
181,836
181,108
180,380
179,652
178,924
2,195,136

BAD BEBT EXP.
86,932
86,204
85,476
84,748
84,020
83,292
82,564
81,836
81,108
80,380
79,652
78,924
995,136

INTEREST EXP.
10,000
10,000
10,000
10,000
10,000
10,000
10,000
10,000
10,000
10,000
10,000
10,000
120,000

PURCHASING EXP.
31,600
0
0
31,038
0
0
30,475
0
0
37,038
0
0
130,150

–
–
–
–
–
–
–
–
–
–
–
–
–

TOTAL S.G.&A.
532,794
499,738
496,462
524,224
489,910
486,634
513,833
480,082
476,806
510,568
470,254
466,978
5,948,282

=
=
=
=
=
=
=
=
=
=
=
=
=

INCOME
222,873
248,111
243,569
207,990
234,485
179,943
194,926
220,859
216,317
174,738
207,233
250,725
2,601,768

=
=
=
=
=
=
=
=
=
=
=
=
=

NOTE:
INCLUDED IN THE OVERHEAD OF JUNE IS $50,000 EQUIPMENT INSTALLATION
COST (ONE TIME COST) FOR THE CUTTING DEPARTMEMT, WHICH SHOULD HAVE BEEN
CAPITALIZED.