Duncan Arrowroot Confectionery (DAC)

Required in hard copy no later than the class scheduled time on Thursday, October 18th.

1) Prepare a memo to the Controller explaining how you would go about classifying the various resources consumed in DAC. Explaining includes providing a clear rationale for the classifications supported with examples from DAC.

You answer should include the following:
i) How to classify resources consumed into product and period.
ii) How to split costs between variable and fixed.
iii) Compute the amount of variable and fixed costs for the quarter ended September 30th, 2018.

{No page limit for the numerical answers as you are required to show detailed computations.
One page limit for the explanations about cost classifications supported by examples.}

2) Prepare the following formal statements in proper format including titles, and proper underlining:
i) Cost of Goods Manufactured Statement for the quarter ended September 30, 2018.
ii) Income Statement for financial reporting purposes under GAAP for the quarter ended September 30, 2018.

3) Prepare the income statement for the quarter just ended September 30th, 2018 using the contribution margin approach. Assume all units produced were sold and ignore inventory balances.

{No page limit for the numerical answers as you are required to show detailed computations}

4) Provide detailed quantitative and qualitative analysis to evaluate introducing the fruit muffins. Provide a clear recommendation whether DAC should do it.

{No page limit for the numerical answers as you are required to show detailed computations.
One page limit for the qualitative analysis.}

(5) Professional presentation and organization of the answer. Written memos should appear first followed by the detailed computations as appendices. Use Excel for your quantitative analysis. Make sure each Excel sheet has appropriate headings.

Attachment:- Duncan Arrowroot Confectionery.rar