Instructions
Cookie Business
In this project, you will be opening your own specialty cookie company to see how product costing methods and changes in production affect business decisions. You will be creating a series of reports and analyzing the results using the template provided to guide you through the project.
The learning objectives of this project are as follows:
Gain an understanding of product costing (direct materials, direct labor, and overhead).
Review job order costing.

Review process costing.
Make business decisions based on analyzing accounting data.
You will prepare a four- to five-page written report (including spreadsheets) with at least two scholarly sources using the  Unit II Project Template . Your report will provide the following information:
Introduction

Part 1: Establish a cookie business selling only one type of specialty cookie with two employees making the cookies.
Create a name and establish a location for the business.
Construct a mission statement for the business.
Decide on the type of cookie you want to make and sell.
Part 2: Develop costing and sales information for 1,000 cookies.

Estimate and explain the cost per cookie based on job order costing (manufacturing overhead is 30% of direct labor costs). Prepare a job order cost sheet by researching and identifying the top five ingredients and their estimated costs as your direct materials. Research and identify the cost of wages for your two employees as your direct labor. It typically takes two days to make 1,000 cookies.
Estimate and explain the cost per cookie based on process costing with 40% conversion costs. Identify the top three processes you feel are needed to make the cookies and prepare a production cost sheet for one of those processes.
Estimate and explain the sales price you plan to set per cookie based on the cost data.

Part 3: Compare and contrast the costing methods used in this project, including which you believe provides the most useful information as a manager.
Part 4: Discuss what will happen to revenue if the number of the cookies sold increases or decreases.
Job Order Cost Sheet
Job number:
Direct Material
Direct Labor
Total Cost per
ingredient
Ingredients
Total
Cost Summary
Direct Materials
Direct Labor
Manufacturing Overhead
Units
Cost per unit
Date
Hours
Rate
Total Cost per
employee
–
1,000
–
Manufacturing overhead
Total Cost
–
Production Cost Report
Department:
Cost:
Beginning WIP
Cost incurred
Total
Material
Units:
Units Completed
Equivalent Units (ending
WIP)
Total
Cost per Equivalent unit
Labor
Overhead
Trans In
e>
Total
1
Title of the Paper Goes Here
Student Name
Institution
ACC 5301 Management Applications of Accounting
Instructor
Date
2
Abstract
The Abstract is an overview of the paper, written after completion. Other researchers use the
abstract to determine if your work will be useful to them. The abstract should include the
background, hypothesis or research question, methodology for data collection and analysis, the
findings of your research, and conclusions. It should be between 100–150 words. This is done
when the paper is complete.
3
Title of Paper
Remember this part of the paper is double spaced in APA format.
The Introduction should lead readers into the topic and its importance. Introductions
typically include the overall topic of the paper, the specific focus of the paper within the larger
topic, the main points in the paper, the kind of paper (study, argument, critique, discussion), and
the purpose.
Writing tip: The length of the introduction should be in proportion to the length of the
paper. Also ask yourself, “With my purpose and my audience, how do I engage my readers
best?” In the introduction, you set the tone of the piece, establish your voice, and demonstrate
your writing style; be authentic to your purpose and your audience.
Part 1 Establish Cookie Business
Identify the name of your company, location, mission statement for your business, and
type of cookie you plan to make. Keep in mind that you are only making one type of cookie for
this project.
Part 2 Costing and Sales Information
Analyze and discuss the estimated cost per cookie using job order costing, the estimated
cost per cookie using process costing, and the estimated sales price per cookie. Embed your
spreadsheets to justify your costs.
Part 3 Compare and Contrast Costing Methods
Analyze and discuss the major differences you see between the types of costing. Which
do you believe is more useful for this business, and why?
Part 4 Impact of Increase and Decrease in Sales
Discuss what will happen to revenue if the number of cookies sold increases or decreases.
4
Conclusions and Recommendations
The Conclusion section should summarize for the readers the topics of importance that
led to your final conclusions/analysis regarding this case. Include some specific areas of focus
from your analysis to reinforce your conclusion.
5
References
Include complete references in proper APA format for all of the citations listed in your
paper. Be sure to use the library for the required number of sources. Additional sources can be
used but should be scholarly. Present your references in alphabetical order.

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