Current Designs 23 a-c (Part Level Submission) The Crane staff has prepared the annual manufacturing budget for the rotomolded line based on an estimated annual production of 4,200 kayaks during 2020. Each kayak will require 74 pounds of polyethylene powder and a finishing kit (rope, seat, hardware, etc.). The polyethylene powder used in these kayaks costs $1.20 per pound, and the finishing kits cost $250 each. Each kayak will use two kinds of labor-2 hours of type I labor from people who run the oven and trim the plastic, and 3 hours of work from type II workers who attach the hatches and seat and other hardware. The type I employees are paid $18 per hour, and the type II are paid $15 per hour. Manufacturing overhead is budgeted at $419,200 for 2020, broken down as follows. Variable costs Indirect materials $46,200 Manufacturing supplies 63,000 Maintenance and utilities 109,200 218,400 Fixed costs Supervision 76,000 Insurance 13,600 Depreciation 111,200 200,800 Total $419,200 During the first quarter, ended March 31, 2020, 1,100 units were actually produced with the following costs. Polyethylene powder $99,490 Finishing kits 275,310 Type I labor 39,600 Type II labor 50,650 Indirect materials 12,100 Manufacturing supplies 16,548 Maintenance and utilities 31,000 Supervision 16,900 Insurance 3,400 Depreciation 27,800 Total $572,798 Your answer is correct. Prepare the annual manufacturing budget for 2020, assuming that 4,200 kayaks will be produced. (List variable costs before fixed costs.) CRANE Rotomolded Line Manufacturing Budget For the Year Ended December 31, 2020 Units to be produced 4,200 Variable costs Polyethylene Powder 372960.00 Finishing Kits 1050000.00 Labor - Type 1 151200.00 Labor - Type 11 189000.00 46200.00 Indirect Materials Manufacturing Supplies 63000.00 109200.00 Maintenance and Utilities Total Variable costs 1981560.00 Fixed Costs Supervision 76000.00 Insurance 13600.00 Depreciation 111200.00 Total Fixed Costs 200800.00 Total Costs 2182360.00 (b) Your answer is partially correct. Try again. Prepare the flexible budget for manufacturing for the quarter ended March 31, 2020. Assume activity levels of 950, 1,050, and 1,100 units. (List variable costs before fixed costs. Round answers to 0 decimal places, e.g. 125.) CRANE Rotomolded Line Manufacturing Flexible Budget Report For the Quarter Ended March 31, 2020 950 1,050 Units to be produced 1,100 Variable costs Polyethylene Powder 84360 93240 97680 $ $ Finishing Kits 237500 262500 275000 Labor - Type 1 34200 37800 39600 Labor. Type 11 42750 47250 49500 Indirect Materials 10450 11550 12100 Manufacturing Supplies 14250 15750 16500 Maintenance and Utilities 24700 27300 28600 Total Variable Costs 448210 495390 518980 Fixed Costs Supervision 19000 19000 19000 Insurance 3400 -4302 -4100 Depreciation 27800 27800 27800 Total Fixed Costs 50200 50200 50200 Total Costs 498410 492310 493410 Assuming the rotomolded line is treated as a cost center, prepare a flexible budget report for manufacturing for the quarter ended March 31, 2020, when 1,100 units were produced. (List variable costs before fixed costs. Round answers to o decimal places, e.g. 125.) CRANE Rotomolded Line Manufacturing Flexible Budget Report For the Quarter Ended March 31, 2020 Favorable Unfavorable Neither Favorable nor Unfavorable Budget Actual Difference 1,000 1,000 Variable Costs Polyethylene Powder Finishing Kits V $ Labor - Type 1 36,000 36,000 Neither Favorable nor Unfavorable Labor - Type II V 50,650 Indirect Materials V Manufacturing Supplies V Maintenance and Utilities V Total Variable costs V Fixed Costs V $ Supervision Insurance Depreciation v Total Fixed Costs V > > > > > alla Current Designs 25 a-d (Part Level Submission) A company that manufactures recreational pedal boats has approached Mike Cichanowski to ask if he would be interested in using Current Designs' rotomold expertise and equipment to produce some of the pedal boat components. Mike is intrigued by the idea and thinks it would be an interesting way of complementing the present product line. One of Mike's hesitations about the proposal is that the pedal boats are a different shape than the kayaks that Current Designs produces. As a result, the company would need to buy an additional rotomold oven in order to produce the pedal boat components. This project clearly involves risks, and Mike wants to make sure that the returns justify the risks. In this case, since this is a new venture, Mike thinks that a 15% discount rate is appropriate to use to evaluate the project. As an intern at Current Designs, Mike has asked you to prepare an initial evaluation of this proposal. To aid in your analysis, he has provided the following information and assumptions. The new rotomold oven will have a cost of $302,000, a salvage value of $0, and an 8-year useful life. Straight-line depreciation will be used. The projected revenues, costs, and results for each of the 8 years of this project are as follows. 1 2. $225,400 Sales Less: Manufacturing costs Depreciation Shipping and administrative costs Income before income taxes Income tax expense Net income $142,800 39,200 18,000 200,000 25,400 11,400 $14,000 Click here to view PV table. (a) x Your answer is incorrect. Try again. Compute the annual rate of return. (Round answer to 2 decimal places, e.g. 15.25%.) .0464 Annual rate of retur % Click if you would like to Show Work for this question: Open Show Work SHOW SOLUTION LINK TO TEXT LINK TO TEXT LINK TO TEXT Attempts: 3 of 3 used (b) Compute the payback period. (Round answer to 2 decimal places, e.g. 15.25.) Payback period years Click if you would like to show Work for this question: Open Show Work