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Arlington Printers operates a printing press with a monthly capacity of 3,200 machine-hours. Arlington has two main customers: Paul Corporation and All (Click to view
Arlington Printers operates a printing press with a monthly capacity of 3,200 machine-hours. Arlington has two main customers: Paul Corporation and All (Click to view the data.) i (Click the icon to view the special order information.) Read the requirements. Begin by calculating the amount that should be used to determine the allocation. Paul Corporation Allison Corporation Contribution margin per machine-hour Since the of Allison is of Paul, to maximize operating than the Corporation. Corporation business and then allocate the remaining to Now calculate the operating income using the allocation you determined above. Paul Corporation Allison Corporation Total * Machine-hours to be worked Operating Income What other factors should Arlington consider before making a decision? (Select all that apply.) A. If Arlington sees long-run benefit in working with the company that provides the greatest profit, then Arlington does not need to be concerned B. If Arlington tums down one of the company's business, will that company continue to place orders with Arlington or seek alternative supplier C. If Arlington sees long-run benefit in working with the company that provides the least profit, then Arlington must also look for ways to increas More info Allison Corporation indicates that it wants Arlington to do an additional $152,000 worth of printing jobs during February. These jobs are identical to the existing business Arlington did for Allison in January in terms of variable costs and machine-hours required. Arlington anticipates that the business from Paul Corporation in February will be the same as that in January. Arlington can choos to accept as much of the Paul and Allison business for February as its capacity allows. Assume that total machine-hours and fixed costs for February will be the same as in January. Done Data table Allison Corporation Revenues Variable costs Contribution margin Fixed costs (allocated) Operating income Machine-hours required [0 Print Paul $ Corporation 228,000 S 98,400 129,600 96,000 $ 33,600 S 2,400 hours Print 152,000 $ 100,000 52,000 64,000 (12,000) S 800 hours Done Total 380.000 198,400 181,600 160,000 21,600 3,200 hours
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