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WoolCorp WoolCorbuys sheep's wool from farmers. The company began operations in January of this year, and is making desions on product offerings, pricing and vendors.
WoolCorp WoolCorbuys sheep's wool from farmers. The company began operations in January of this year, and is making desions on product offerings, pricing and vendors. The company is also examining its method of assigning overhead to products. Youve just been hired as a production manager at WooCora Currently WooCorp makes three products: (1) raw, clean wool to be vied as stuffing or station (2) wool yarn for use in the title Industry, and (3) extra-thick yom for use in rug Upper management would like your recommendations regarding a production decision regarding their current and proposed product lines Continue/Discontinue For the past year, Wolicarp has experimented with its third product, extra-thick rus yarn. The company wishes to consider whether to continue or discontinue manufacturing and selling this product. You decide to prepare a differential analysis of the income related to a three products. To begin your analyse, you review the following condensed Income statement. Then scroll down to complete the differential analyse WoolCorp Condensed Income Statement For the Year Ended December 31, 2018 Raw Wool Wool Yarn Rug Yarn Total Company Sales 5200,000 $155,000 $177,000 $532,000 Costs of goods said: Variable costs $(48,000) (18.600) $(37,190) $(103,790) Fixed costs (32.000) (12.400) (24,800) (69,200) Total cost of goods sold $180,000) $(31,000) $(61,990) $(172.990) Gross profit $120,000 $124,000 $115,010 5359,010 prepare analyss of the income related to reproduc 1 begin your analysis, you review the flowing condensed income statement en scroll down to complete WoolCorp Condensed Income Statement For the Year Ended December 31, 2018 Raw Wool Wool Yarn Rug Yarn Total Company Sales $200,000 $155,000 $177,000 $532,000 Costs of goods sold Variable costs $(48,000) $(18,600) $(37,190) 3(103,790) Feed costs (32,000) (12,400) (24,800) (69,200) Total cost of goods sold $(80,000) $(31,000) $(61,990) 5(172.990) Gross pront $120,000 $124,000 $115,010 $359,010 Operating expenses Variable expenses 515,000) $(7.750) $(53.130) 65,880) Fixed expenses (89,000) (77,500) (106,200) (272,700) Total operating expenses $(94,000) $(85,250) (159,330) $(338,580) Operating income (loss) $26,000 $38,750 $(44,320) $20.430 Complete the following table using the data in the preceding income statement to compare the effects of dropping the rug yarn line of products. If required, use a minus sign to indicate a los Differential Analysis Continue Rug Yarn (Alternative 1) or Discontinue Rug Yarn (Alternative 2) December 31, 20Y8 Continue Rug Yarn (Alternative 1) Discontinue Rug Yarn (Alternative 2) Differential Effects (Alternative 2) Complete the lowing the wing the data in the preceding income statement to come the effects of creeing the rug vamine of products. It required, thus vign to indicate Differential Analysis Continue Rug Yarn (Alternative 1) or Discontinue Rug Yarn (Alternative?) December 31, 2018 Continue Rug Yarn (Alternative 1) Discontinue Rug Yarn (Alternative 2) Differential effects (Alternative 2) Revenge Coats Varate DDD Fed Profit Final Questione Answer the following question (1), then fill in table (2). 1. Anar ring your work on the Continue/Dicotine panel, should WooCorp continue (Alternative 1) or discontinue (Alternative 2) the rug van product line? 2. The following table shows several business desions that might need to be made across the top row. Along the left-hand column, there are important factors to consider Select the factors that are important to the decision. Select all that apply. If the factor is not important to any of the decisions, select "yeson the Net Important dropdown, otherwise select "no Lease or Sell or Special Price Continin
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