Exhibit 1 Sippican Corporation: Operating Results (March 2006) Sales $1.847.500 100% Direct Labor Expense 351,000 Direct Materials Expense 458 000 Contribution Margin $1,038,500 56% Manufacturing Overhead Machine-related expenses $334,800 Setup labor 117,000 Receiving and production control 15,600 Engineering 78,000 Packaging and shipping 109,200 Total Manufacturing Overhead 654,600 35% Gross Margin 383,900 21% General, Selling & Administrative Expenses 350,000 19% Operating Income (pre-tax) $_33,900 1.8% Source: Casewriter. Exhibit 2 Product Profitability Analysis (March 2006) Valves Pumps Flow Controllers Direct labor costa $12.35 $16.25 $13.00 Direct material cost 16.00 20.00 22.00 Manufacturing overhead (@ 185%) _22.85, _30.06 24.05 Standard unit costs $51.20 $66.31 $59.05 Target selling price $78.77 $102.02 $90.85 Planned gross margin (%) 35% 35% 35% Actual selling price $79.00 $ 70.00 $95.00 Actual gross margin $27.80 $ 3.69 $35.95 Actual gross margin (%) 35% 5% 38%Exhibit 3 Product Data Product Lines Valves Pumps Flow Controllers Materials per unit 4 components 5 components 10 components 2 @ $2 = $4 3 @ $2 = $6 4 @ $1 =$ 4 20 6= 12 207= 14 5 @ 2= 10 10 8= 8 Materials cost per unit $16 $20 $22 Direct labor per unit 0.38 DL hours 0.50 DL hours 0.40 DL hours Machine hours per unit 0.5 0.5 0.3 Setup hours per run 5 6 12 Source: Casewriter. Exhibit 4 Monthly Production and Operating Statistics (March 2006) Valves Pumps Flow Controllers Total Production (units) 7,500 12,500 4,000 24,000 Machine hours (run time) 3,750 6,250 1,200 11,200 Production runs 20 100 225 345 Setup hours (labor and machines) 100 600 2,700 3,400 Number of shipments 40 100 200 340 Hours of engineering work 60 240 600 900