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Accounting 2302 Name________________________

Excel Assignment 2 Due Date_____________________

SCHEDULE OF COST OF GOODS MANUFACTURED AND SOLD


AND PARTIAL INCOME STATEMENT

The learning objectives for this activity include:

• Use of electronic spreadsheets to solve accounting-related problems.


• Preparation of a Schedule of Cost of Goods Manufactured and Sold.
• Analysis of changes in labor cost needed to achieve production goals.
• Alteration of an Excel worksheet to include an income statement for a manufacturing firm.
• Creation of a chart showing the dollar amount of materials, labor, and overhead.

PROBLEM DATA

The following is information for Meriwell Manufacturing for the year ended December 31, 2007:

Finished goods, beginning $20,000


Finished goods, ending 40,000
Depreciation, factory 27,000
Administrative Expenses 110000
Utilities, Factory 8000
Maintenance, Factory 40000
Supplies, Factory 11000
Insurance, Factory 4000
Purchase of Raw Materials 125,000
Raw Materials inventory, beginning 9,000
Raw Materials inventory, ending 6,000
Direct labor 70,000
Indirect labor 15,000
Work in process, beginning 17,000
Work in process, ending 30,000
Sales 500,000
Selling expense 80,000

Requirement 1: Preparing the Schedule of Cost of Goods Manufactured and Sold and Partial
Income Statement

For this Excel assignment, you are to plan the expected outcome of the Schedule of the Cost of
Goods Manufactured and Sold. An Excel template for the schedule is provided, which is similar to
the Cost of Goods Manufactured Schedule in your text. You are to identify the formulas and titles to
complete the schedule’s worksheet. The spreadsheet is designed to accommodate the flexibility
required when accounting assumptions change. As in previous Excel assignments for this course,
you are required to use separate data and answer sections.

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First, attempt to identify the appropriate formulas associated with the values in the data section of
this assignment. Remember that the cells that contain a value of “$0” are empty for now, but do
contain a formula that will change once formulas are entered for related cells.

• The Excel data file for this assignment is titled, Excel2 is available in on the course
schedule…or click.
• Download the data file (called Excel2.xls) and SAVE AS ExcelAssignment2.
• Close the online version of the worksheet and open ExcelAssignment2 from your local drive.

Your version of ExcelAssignment2 should contain the following worksheets:


• Require1
• Chart1
• MFGCost
• The Require1 worksheet contains your initial template for the Schedule of Cost of Goods
Manufactured.
• Now, insert an additional worksheet and name it Require2.
• Enter the formulas and titles for Require1. Remember that cells that contain zeros now will
change to non-zero values as formulas are entered.
• It might help to remember that the Schedule of Cost of Goods Manufactured is based on a
10-step process associated with the Manufacturing Process T-Account Analysis.
Furthermore, the Schedule of Cost of Goods Manufactured and Sold is a 13-step process
associated with the same Manufacturing Process T-Account analysis.
• The check figure for cost of goods sold is $270,000.

Once you have entered the descriptions and formulas in the appropriate cells for Require1, prepare a
header for your document. The purpose of the header is to insert a name, description, page#, etc. for
the document. To create a header for your Excel Require1 worksheet:

• While in the Require1 worksheet, select View/Headers and Footers from the main menu. A
page setup like this will appear.

• Click on the Custom Header tab.

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After entering the information I have requested above for your worksheet, click OK to close the
Header View. The requested information should appear on the Require1 worksheet. Save
ExcelAssignment2.

Requirement 2: Changing Assumptions for a Year 2008 Analysis

Copy and paste the contents of the completed Require1 worksheet into the Require2 worksheet. All
appropriate formulas should have been created earlier in Require1. Thus, with the exception of
changing the beginning balances, any changes to the new worksheet should be minimal.
Assume the changes below are made in account balances for the following year, 2008. With the
exception of beginning balances, any balances not identified below remain unchanged.

Depreciation, factory $ 46,500


Direct labor 64,500
Raw Materials inventory, 12/31/08 5,050
Finished goods, 12/31/08 41,500
Indirect labor 12,000
Purchases of raw materials 100,000
Work in process, 12/31/08 27,225

• Change all balances indicated above. Don’t forget to change beginning balances!!!
• Save ExcelAssignment2.

Requirement 3: Graphical Analysis of Results

The purpose of this requirement is to create a graphical representation of the elements of total
manufacturing costs taken from the two worksheets. The values necessary to present the graph have
been created in the tables located in the MFGCost worksheet. You are simply to discuss the results
and include the chart values in your assignment. The results can be viewed in chart form on the
Chart1 worksheet.

Discussion of Year 2007 Results

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The management of Meriwell Company is convinced that the quality of Meriwell’s products is
highly dependent on the relative labor costs required. Experience has shown that direct labor should
account for at least 25% of the total product cost. From the pie chart (Chart1) worksheet it appears
Meriwell did not achieve this goal in 2007. How much should Meriwell have spent on direct labor
to reach its 25% goal?

• From the Chart1 worksheet, analyze pie chart results and answer the following question:

Requirement 1: Analysis of Year 2007 Total Manufacturing Costs

In order for Meriwell Company to achieve its year 2007 objective, the direct labor required should
be $______________________.

You may place your response in the Chart1 worksheet, or in a separate worksheet.

Requirement 4: Create Your Own Chart or Graph for Year 2008 Results

In the previous section, you were given a sample chart and asked to analyze its results. In this
section, you will create your own chart using the chart wizard. This chart analysis will be for the
second year, 2008.

• With ExcelAssignment2 open, click on the MFGCost worksheet. This worksheet is the source of
information about total manufacturing costs for both years.
• By now you have completed Require1, the Cost of Goods Manufactured Schedule for year 2007.
Let's study how the graphical analysis of Cost of Goods Manufactured (Chart1) was prepared:

o While in the worksheet, MFGCost, click on either cell B4, B5, or B6. Notice the cell
value. For example, the cell value for B4 is defined =Require1!D36. This means that
the cell value for B4 was taken from cell D36 of worksheet Require1, which is the
Schedule of Cost of Goods Manufactured for year 2007.
o Open Chart1. Observe that the pie chart was created based on values taken from the
MFGCost worksheet. You could take source data directly from any worksheet (like
Require1).
o Right-click on the pie chart. A window should open to display the formula =MFGCost!
$A$4:$B$6. Your source data for Chart1 is (A4 to A6 and B4 to B6 of the MFGCost
worksheet). What do you see when you view these cells in the MFGCost worksheet?
o Now that you have viewed the contents of a chart, it's time to create your own chart for
year 2007 data.
o Begin by completing the Schedule of Cost of Goods Manufactured and Sold for year
2008 (Require2 worksheet). For example, the appropriate cell value for C4 =Require2!
D36.
o Once you have the source data for your chart entered into MFGCost, you are ready to
create your chart.

Before beginning, highlight the columns that will appear in your chart. In other words, highlight
cells A4 to A6. With these values for column A selected, press control and select a second group of
cells: C4 to C6. Your darkened MFGCost worksheet should look like this:
Materials 128,000 ?
Labor 70,000 ?
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Overhead 105,000 ?
(Highlighted cells are the cells to be used for your chart)

Now let's begin.


• While in the MFGCost worksheet, select Insert/Chart from the Menu Bar.

The Chart Wizard will open. Perform four steps to create your chart:

Step 1: Select a type of chart. Choose any type except Pie Chart because we have used that type
already. Select Next to continue.

Step 2: Identify the source data for you chart. If you highlighted columns A and C, the data should
already appear in the data source box. Here is the source data that should appear:

=MFGCost!$A$4:$A$6,MFGCost!$C$4:$C$6

This is how to interpret the above formula:


Data from the MFGCost worksheet (cell values A4 to A6) and data from the MFGCost
worksheet (cell values C4 to C6) will appear in the table you create.

 Do NOT include the total in your chart.


 Click the Column radio button because you want your data to come from the series of
columns you have identified. That would be column A and column C. Click Next.

Step 3: Chart Options: Choose where to place the legend for your chart. This is your choice.

Step 4: Chart Wizard - Chart placement. Indicate that you wish to place the chart in a "new sheet"
rather than adding it to the worksheet in which you are working.

Now view your chart before selecting FINISH. If you are not satisfied with the previous steps, just
go backwards through the Chart Wizard and make new selections. Save your new chart as Chart2.
Don’t forget to name the Worksheet tab, Chart2 as well.

Analyzing 2008 Results

Now let's use the Chart Wizard from the Menu bar to create an analysis of year 2008 results.
• Determine if Meriwell achieved its 25% goal in 2008. (i.e., is direct labor >25% of total
manufacturing costs?)
• Answer the following question (in Excel).

Requirement 3: Year 2008 Analysis of Cost:

Currently, Meriwell Company's direct labor is ___________ percent of Total Manufacturing Costs.
It appears that Meriwell Company has incurred a decline in income for year 2008 for the following
reasons (this requires that you compare year 2007 to year 2008):
 ___________________________________
 ___________________________________

Preparation of Excel Assignment 2 for submission.

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In order for your Excel document to print correctly, you will need to properly “paginate” the
worksheets of your Excel workbook so that these pages can be printed correctly. Specifically, I
should be able to select the “print entire workbook”option, and successfully print your assignment.
Here we go...

Step 1: Highlight the area of a given worksheet to be printed. From the Excel menu, select
File/Print Area. This will secure the highlighted area for printing.
• Click the Print Preview Area button on the menu bar to view the worksheet page as it
will appear when printed. You can also find the Print Preview option this way…
File/Print Preview.
• If the print preview area does not please you, make the necessary modifications. Such
modifications include:
* Reducing column sizes or row sizes.
* Reducing font size
* Setting the page orientation asportrait

landscape

* Fit to page: This option places one worksheet per printed page…
(Select File/Fit to Page(s)).

…….Fit to page will reduce the content for each page, as appropriate.

Step2: View each worksheet (File/Print Preview) until its appearance is acceptable to you. It is
acceptable to me if I can Print Entire Workbook without stray words on extra pages. Once you are
convinced that you have set your page margins appropriately. Print the entire document…
Print/Entire Document. Be sure your name appears on your Workbook.

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Click File/Print/Entire Workbook. If it prints successfully for you, it will print successfully for me.

Please not that I will deduct points for missing student names and poor pagination.

Excel Assignment 2 deliverables:


 Submit the entire ExcelAssignment2.xls workbook to the Blackboard course
management system by the assigned due date.