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Fun ¡¯n¡¯ Games Company
Fun ¡®n¡¯ Games Company was founded by Avery Rinehart to produce a novelty item marketed under the name ¡°Puzzler.¡± Each ¡°Puzzler¡± cost the company $14 to produce. In addition to these production costs that varied in direct proportion to volume (so-called variable costs), the company also incurred $4,000 monthly ¡°being in business¡± costs (so-called fixed costs) irrespective of the month¡¯s volume. The company sold its product for $22 each.
As of December 31, Rinehart had been producing ¡°Puzzler¡± for three months using rented facilities. The balance sheet on that date was as follows:
Balance Sheet
As of December 31
Assets
Cash $ 58,500
Accounts receivable 27,500
Inventory 14,000
$100,000......
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Title: Fun ¡¯n¡ Games Company
Approximate Word Count: 1322
Approximate Pages: 6 (250 words per double-spaced page)
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