Managerial Accounting case study paper

T&J manufacturing has a factory that produces custom kitchen cabinets. It has multiple product lines.

Materials and labor for the cabinets are determined by each job. To simplify the assignment, we will assume the .

The materials include $1,000 for the wood and other direct materials of $200. Both items listed are on a per job basis. It requires 20 hours of labor on average for a custom kitchen. The hourly rate is $10.

The sales price will be set at a markup of 65%.

The companyestimatesthat it will have 16,000 direct labor hours in total for all product lines.

It assumes 800 units are sold on average per year. A breakdown of estimated yearly costs related to the :

Salaries- office & administrative

$ 520,000

Salaries for factory personal:

$220,000

Office Rent

$ 125,000

Factory Rent

$20,000

Office Utilities and (based on units sold)

$20,000

Sales Travel(based on units sold)

$24,000

Insurance – office

$12,000

Depreciation – office equipment

$40,000

Depreciation for factory equipment

$70,000

Advertising

$20,000

Sales commissions(based on units sold)

$45,000

Factory Property taxes:

$10,000

Maintenance for factory equipment:

$80,000