50.1K

Verified Solution

Link Copied!

pls answer it all. the last "expert" did all the work but cropped out half of the answers before submitting it so i had no answers for the differential analysis and half of the rest

WoolCorp Wool Carp buys sheep's wool from farmers. The company began operations in January of this year, and is making decisions on product offerings, pricing. and vendors. The company is also examining its method of assigning overhead to products. You've just been hired as a production manager at WoolCorp. Currently WoolCorp makes three products: (1) raw, clean wool to be used as stuffing or insulation; (2) wool yarn for use in the textile industry, and (3) extra-thick yarn for use in rugs. Upper management would like your recommendations regarding a production decision regarding their current and proposed product lines. Continue/Discontinue For the past year, WoolCorp has experimented with its third product, extra-thick rug vam. 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 all three products. To begin your analysis, you review the following condensed income statement. Then scroll down to complete the differential analysis. WoolCorp Condensed Income Statement For the Year Ended December 31, 2048 Raw Wool Wool Yarn Rug Yarn Total Company Sales Costs of goods sold: $200,000 $155.000 $197.000 $552,000 Variable costs $(48,000) $(18,600) $(37,150) $(103,750) WoolCorp Condensed Income Statement For the Year Ended December 31, 2018 Raw Wool Wool Yarn Rug Yarn Total Company Sales $200,000 $155,000 $197,000 $552,000 Costs of goods sold: Variable costs $(48,000) $(18,600) $(37,150) $(103,750) Fixed costs (32,000) (12,400) (24,790) (69,190) Total cost of goods sold $(80,000) $(31,000) $(61,940) $(172,940) Gross profit $120,000 $124,000 $135,060 $379,060 Operating expenses: Variable expenses $(5,000) $(7.750) $(53,100) $(65,850) Fliced expenses (89,000) (77,000) (106,200) (272,200) Total operating expenses $(94,000) $(84,750) $(159,300) $(338,050) Operating income (loss) $26,000 $39,250 $(24,240) $41,010 Complete the following table using the data in the preceding income statement to compare the effects of dropping the rug varn line of products. If required, use a minus sign to indicate a loss Differential Analysis 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 loss. Differential Analysis Continue Rug Yarn (Alternative 1) or Discontinue Rug Yarn (Alternative 2) December 31, 2018 Continue Rug Yarn (Alternative 1) Discontinue Rug Yarn (Alternative 2) Differential Effects (Alternative 2) Revenues Costs: Variable Fixed Profit (loss) Final Questions Anwwe the owing question (i), then fill in table (2) 1. Aher reviewing your work on the Continue Descontinue panel, should WooCorp continue (Alternative 1) or discontinue (Alternative 2) the rug var product line? Sell 2. The following table shows several business decisions 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 we important to the decision. Select all that apply. If the factor is not important to any of the decisions, selected on the "Not important dropdown, otherwise select "no" Lease or Sell or Special Price Continue or Production Not Process Further Order Make or Buy Discontinue Bottleneck Important Impact on regular prices Con margin per bottleneck hour Die than Woons were

Answer & Explanation Solved by verified expert

See Answer