Gillian Zucker

Tristian Penick
Accounting Final Write Up
Baked Good: Nothing But Nutella Brownie
Baked, Sealed, Delivered is a small company that sells baked goods. One
of the products offered for sale is called the Nothing but Nutella Brownie. A
batch of The Nothing but Nutella Brownies consists of 9 brownies and is made
using the ingredients 10oz (1 cups) of Nutella, 2 Eggs, and cup of allpurpose flour. The cost of Nutella used per batch is $3.53, this is by far our
most expensive ingredient used in our brownie, but we are okay with paying this
much for the ingredient because it is the most important ingredient, and it brings
the desired flavor to the brownie. Eggs costs $0.3 per batch, and flour costs
$0.03 per batch.
The estimated product costs for the Nothing but Nutella Brownie are in
regards to a monthly period and are as follows. The direct materials estimated
product cost is $126. The direct labor estimated product cost is $30.57. The
manufacturing overhead estimated product cost is $150.
The packaging used for this product is simple, yet very attractive and
convenient. The packaging consists of cellophane bags, which cost $1.6 per
batch and Hello My Name is nametags, which cost only $0.24 per batch. Each
batch brownies is taken out of the oven, and cut into nine individual brownies.
The brownies are places into a cellophane bag and the bag is brought to a
close, and sealed with the Hello My Name Is sticker that is written on and
reads Nothing but Nutella Brownie

Being that Baked, Sealed, Delivered is still in its growing stage, the
company does not yet have their own storefront to distribute product. Their
products are distributed to the local grocery stores, and coffee shops and then
sold from those locations. Due to this type of distribution channel, the baked
goods are able to reach a wider audience, than the typical audience for a
bakery.
The estimated period costs have been calculated for Baked, Sealed,
Delivered and are based off of sales at 13 batches per month, and are as
follows. The selling expenses consist of the cost of goods manufactured ($126),
Labor ($30.57), distribution ($100), and packaging ($23.92). This brings the total
selling expense to $277.37. The administrative expense consists only of the
oven rental at $50.
The break-even analysis for the Nothing but Nutella Brownie was found
using the equation method. This method requires you to add the fixed costs
($150) for the products with the desired profit (in the case of breaking even, the
desired profit is zero) and you then divide that by the contribution margin. Our
contribution margin is found by subtracting the cost to make the brownie ($0.63)
by the selling price of the brownie ($2.75). The equation for the Nothing but
Nutella Brownie is (150 + 0)/ 2.12. This shows that the break-even point is 71
units (brownies) or 8 batches (of 9 brownies).
Baked, Sealed, Delivereds product Nothing but Nutella Brownie is a treat
that any Nutella lover would be more than happy to indulge in. Being that the
company does not have a storefront, we are able to provide freshly baked goods
to people that wouldnt usually walk into a bakery to buy freshly baked goods by
distributing the baked creations to grocery stores and coffee shops for re-sale.

The current target audience for the Nothing but Nutella Brownie is the busy
mother, who shops at a grocery store for her families needs. We try reaching
this target audience by supplying the fresh oven baked bakery brownies at a
grocery store where the targeted busy mother shops for the entire family. The
convenience of having a bakery good at the grocery store will attract the
mothers attention, and she will be drawn to the delicious flavor of the brownie
that the whole family will love. The busy mother may also stop at a coffee shop
throughout the day to get a boost of energy, and what goes better with a boost
of energy than a Nothing but Nutella Brownie? As the mother is getting a coffee
for herself she will be inclined to also purchase a small treat for her children, and
the Nothing but Nutella Brownie would be a great option.

Income Statement
200x2.7
5
Sales
Beg. Inventory

$550
$0.00

$2.75 is the sale

price

+Purchases per month

Costs of Goods Manufactured
Nutella
Eggs

9 units per 1
batch

$200x $0.63= $126

$3.53x13=$45.89
$0.3x13=$3.9

150+100/2.12=
118 units
118/9= 13
batches
13 batches per
month

Flour

$0.0332x13=$0.43

Total Available
For Sale

$126.0
0

-Ending
Inventory
COGS

$424.00

Gross Profit=
Expenses Per
13 Batches
Packaging-$1.6
per batchx13
Labor-2.3 per
batchx 13

using$20.8
=not-$21
$30.57

Distribution

$100

Oven Costs

$50

Equals Total
Expenses

$201.37

Equals Net
Profit

$222.63

Balance Sheet:
Assets
Cash
$25
Accounts Receivable $55
Inventory
Raw Materials $0
Finished Goods $126
Prepaid Expense
$0
Fixed Asset
$50
Total Assets

$256

Liabilities & Owners Equity

Accounts Payable
$40
Notes Payable
$30
Total Liabilities
$55
Original Investment
Retained Earning
Earnings Week-to-Date
Total Owners Equity

$25
$50
$56
$131

Total Liabilities & Owners Equity $256

Nothing but Nutella Brownie

Baked, Sealed,