The Foraker Company provides landscaping services to corporations and businesses. All its landscaping work requires Foraker to use landscaping equipment. Its landscaping equipment has the capacity to do 13,000 hours of landscaping work. It currently anticipates getting orders that would utilize 10,500 hours of equipment time. Foraker charges $110 per hour for landscaping work. Cost information for the current expected activity level is as follows: 6 (Click the icon to view the cost information.) Read the requirement. Begin by completing an analysis, and start by showing the computation of the company's contribution margin without the landscaping work from Nancy. Next, calculate the contribution margin of the special order. (Calculate the contribution margin for the special order assuming there are no constraints on landscaping hours.) Contribution Margin for Existing Landscape Customers Revenues Variable costs: Landscaping costs Marketing costs Total variable costs Contribution margin The Foraker Company provides landscaping services to corporations and businesses. All its landscaping work requires Foraker to use landscaping equipment. Its landscaping equipment has the capacity to do 13,000 hours of landscaping work. It currently anticipates getting orders that would utilize 10,500 hours of equipment time. Foraker charges $110 per hour for landscaping work. Cost information for the current expected activity level is as follows: E (Click the icon to view the cost information.) Read the requirement. Begin by completing an analysis, and start by showing (Calculate the contribution margin for the special order Requirement alculate the contribution margin of the special order. Contribution Margin Existing Landscap Customers In order to fill its available capacity, Foraker's salespersons are trying to find new business. Nancy Corporation wants Foraker to do 2,300 hours of landscaping work for $68 per hour. Variable landscaping costs for the Nancy Corporation order are $44 per hour and variable marketing costs are 5% of revenues. Foraker can accept as much or as little of the 2,300 hours of Nancy's landscaping work. What should Foraker Corporation do? Revenues Variable costs: Landscaping costs Marketing costs Print Done Total variable costs Contribution margin The Foraker Company provides landscaping services to corporations and businesses. All its landscaping work requires Foraker to use landscaping equipment. Its landscaping equipment has the capacity to do 13,000 hours of landscaping work. It currently anticipates getting orders that would utilize 10,500 hours of equipment time. Foraker charges $110 per hour for landscaping work. Cost information for the current expected activity level is as follows: 6 (Click the icon to view the cost information.) Read the requirement. Data table te the contribution margin of the special order. Begin by completing an analysis, and start by shd (Calculate the contribution margin for the special Contribution M $ 1,155,000 Existing Lan Custom 787,500 Revenues Revenues ($110 x 10,500 hours) Variable landscaping costs (largely labor), which vary with the number of hours worked ($75 per hour * 10,500 hours) Fixed landscaping costs Variable marketing costs (5% of revenues) Fixed marketing costs 105,000 Variable costs: 57,750 69,000 Landscaping costs 1,019,250 Marketing costs Total costs $ Total variable costs 135,750 Operating income Contribution margin Print Done Etext pages Calculator Get n Clear all Check
