Twin City Press produces textbooks for high school accounting courses. The company recently hired a new adnor, Leigh Green, to handle production and sales of books for an introduction to contingut compensation depends on the gross margin associated with sales of this book. Leigh needs to decide how many copies of the book to produce the folowing formation is for the follor 2011 Click the icon to view the Information) Leigh has decided to produce either 23,000 34,500, or 36.800 books Read the weiterents Requirement 1. Calculate expected gross margin if Leigh produces 23,000, 34500, 36.800 books (More are you in the production volume varianter of cost of rods sold Calculate the groue margin for each level of production. Begin with 23,000 books, then 34,500 books, and launy 36.800 books, Entora u for any ere balance on the newest label 23,000 books 34,500 books 36.800 books Revenuen Cost of goods sold Production volume variante Netcost of goods sold Gros margin Requirement 2. Calculate ending inventory in units and in dofars for each production vol. (Complete all answer. For amounts with unit orale, 23,000 books 34,500 books 36.600 books Beginning irwentory books books Production books Salos DOORS books books Ending inventory h produces 23.00 X e as part of cost of goods sold) Ice accounts. If an account does not have a variance, do not selecta Begin with 23,00 More info 500 books Estimated sales 23,000 books Beginning inventory O books Average selling price $86 per book Variable production costs $53 per book Fixed production costs $506,000 per semester The foxed-cost allocation rate is based on expected sales and is therefore equal to $506,000/23,000 books = $22 per book. balance, make sure to enter "o" in the appropriate cet) nd in dollars for ead 500 books books Print Done books LOORS Calculate expected gross m Old) X oss margin for each level of Poes not have a w Requirements 23,000 bo sold me variance 1. Calculate expected gross margin if Leigh produces 23,000,34,500, of 36 800 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. 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 excess of demand. Do you think the following metrics will accomplish this objective? Show your work a. Incorporate a charge of 10% of the cost of the ending inventory as an expense for evaluating the manager b. Include nonfinancial measures when evaluating management and rewarding performance ods sold "U" in the appropri 2. Calculate ending inventory 23,000 books entory book Print Done Mory books books DOORS
