Wilkerson Case Essay

1345 Words Aug 7th, 2016 6 Pages
1. Describe Wilkerson’s competitive environment. At a minimum, include any barriers to entry, industry maturity, the specific market and production complexity for each product, and marketing concerns.

Wilkerson is a manufacturing company specializing in manufacturing components for water purification systems; the company makes valves, pumps, and flow controllers. Wilkerson is a supplier to companies that actually manufacture the water purification equipment. The relevant officers of the organization are:

* Robert Parker, President * Peggy Knight, Controller * John Scott, Manufacturing Manager

According to the United States International Trade Commission,

“U.S. exports of water filtration and purification equipment
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To briefly summarize, prime costs are directly traced. Each product consists of several components with varying costs and labor inputs. MOH is applied using a fixed rate of 300%

4. Using expected production levels, construct an ABC system. For each ABC activity pool, calculate an activity rate and an activity percentage (%). For each product, calculate the overhead cost per unit and the total cost per unit using ABC.

Manufacturing Overhead Rates | | Machine Expense/Machine hours | $30.00 | Setup Labor Cost/Production run | $250.00 | Receiving &ProdControl/Production run | $1125.00 | Engineering Cost/Hour of Engineering work | $80.00 | Packaging & Shipping/Number of shipments | $500.00 | | Pumps | Valves | Flow Controllers | Direct Material | $16.00 | $20.00 | $22.00 | Direct Labor | $10.00 | $12.50 | $10.00 | | | | | Total Prime Costs | $26.00 | $32.50 | $32.00 | | | | | MOH | | | | Machine related expense | 15.00 | 15.00 | 9.00 | Setup Labor | 0.33 | 1.00 | 6.25 | Rec & Production Control | 1.50 | 4.50 | 28.13 | Engineering | 2.67 | 2.40 | 12.50 | Packaging and Shipping | 0.67 | 2.80 | 27.50 | Total MOH | $20.17 | $25.70 | $83.38 | | | | | Total Unit Cost | $46.17 | $58.20 | $115.38 |

5. What

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