Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Wilson Sunland is a leading producer of vinyl replacement windows. The companys growth strategy focuses on developing domestic markets in large metropolitan areas. The company

Wilson Sunland is a leading producer of vinyl replacement windows. The companys growth strategy focuses on developing domestic markets in large metropolitan areas. The company operates a single manufacturing plant in Kansas City with an annual capacity of 500,000 windows. Current production is budgeted at 450,000 windows per year, a quantity that has been constant over the past three years. Based on the budget, the accounting department has calculated the following unit costs for the windows: Direct materials $55.00 Direct labor 15.00 Manufacturing overhead 17.00 Selling and administrative 14.00 Total unit cost $101.00 The companys budget includes $5,400,000 in fixed overhead and $3,150,000 in fixed selling and administrative expenses. The windows sell for $150.00 each. A 2% distributors commission is included in the selling and administrative expenses. (a1) Calculate variable overhead per unit and variable selling and administrative costs per unit. (Round answers to 2 decimal places, e.g. 15.25.) Variable overhead per unit $enter a dollar amount rounded to 2 decimal places Variable selling and administrative costs per unit $enter a dollar amount rounded to 2 decimal places (a2) Marigold, Finlands second largest homebuilder, has approached Wilson with an offer to buy 75,000 windows during the coming year. Given the size of the order, Marigold has requested a 35% volume discount on Wilsons normal selling price. Calculate the contribution from special order. (If net contribution is negative, enter amount with a negative sign, e.g. -5,285 or parentheses, e.g. (5,285). Round answer to 0 decimal places, e.g. 8,971.) Net contribution from special order $enter the net contribution from special order in dollars rounded to 0 decimal places Should Wilson grant Marigold s request? select an option (c1) Return to the original data. Monk Builders has just signed a contract with the state government to replace the windows in low-income housing units throughout the state. Monk needs 80,000 windows to complete the job and has offered to buy them from Wilson at a price of $120.00 per window. Monk will pick up the windows at Wilsons plant, so Wilson will not incur the $2 per window shipping charge. In addition, Wilson will not need to pay a distributors commission, since the windows will not be sold through a distributor. Calculate the contribution from special order, contribution lost from regular sales and the net contribution from special order. Contribution from special order $enter a dollar amount Contribution lost from forgone regular sales $enter a dollar amount Net contribution from special order $enter a dollar amount

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Information Technology Audit Handbook

Authors: Doug Dayton

1st Edition

0136143148, 978-0136143147

More Books

Students also viewed these Accounting questions