Mountain Press produces textbooks for high school accounting courses. The company recently hired a new editor, Jan Green, to handle production and sales of books for an introduction to accounting course compensation depends on the gross margin associated with sales of this book. Jan needs to decide how many copies of the book to produce. The following information is available for the fall semester 201 i (Click the icon to view the information. Jan has decided to produce either 50.000, 65.000, or 70.000 books. Read the requirements Requirement 1. Calculate expected gross margin if Jan produces 50,000, 65,000, or 70,000 books. (Make sure you include the production-volume variance as part of cost of goods sold.) Calculate eg ach level of production. Begin with 50,000 books, then 65,000 books, and lastly 70,000 books. (Enter "0" for any zero balance accounts. If an account does not have a let a label. variance, 50,000 books Revenues Cost of goods sold Production-volume variance 9-36 (book/static) Mountain Press produces textbooks for high school accounting courses. The company recently hired a new editor, Jan Green, to handle production and sales of books for an introductio Jan's compensation depends on the gross margin associated with sales of this book. Jan needs to decide how many copies of the book to produce. The following information is availabl 2017: (Click the lcon to view the informatio - X iRequirements Jan has decided to produce either 50,00 Read the requirements Calculate the gross margin for each leve variance, do not select a label.) If an account 1 Calculate expected gross margin if Jan produces 50,000, 65,000, or 70,000 books. (Make sure you include the production-volume variance as part of cost of goods sold.) 2. Calculate ending inventory in units and in dollars for each production level. 50,00 3. Managers who are paid a bonus that is a function of gross margin may be inspired to produce a product in excess of demand to maximize their own bonus. There are metrics to discourage managers from producing products in excess of demand. Do you think the following metrics will accomplish this objective? Show your work. Incorporate a charge of 10% of the cost of the ending inventory as an expense for evaluating the manager. Include nonfinancial measures when evaluating management and rewarding performance Revenues Cost of goods sold a Production-volume variance b Net cost of goods sold Gross margin Print Done i e i (Click the icon to view the information.) Jan has decided to produce either 50,000, 65,000, or 70 000 hooks Read the requirements Calculate the gross margin for each level of production variance, do not select a label.) - X i More Info 50,000 books Estimated sales 50,000 books Revenues Beginning inventory 0 books Cost of goods sold Average selling price 160 per book Production-volume variance Variable production costs 100 per book Net cost of goods sold $ 750,000 per semester Fixed production costs Gross margin The fixed-cost allocation rate is based on expected sales and is therefore equal to $750,000/50,000 books $15 per book. hoose from any list or enter any number in the inp Print Done parts aininc
