SkippedMcGrawHillFanning Construction Company is a building contractor specializing in small commercial buildings. The company has the opportunityto accept one of two jobs; it cannot accept both because they must be performed at the same time and Fanning does not have thenecessary labor force for both jobs. Indeed, it will be necessary to hire a new supervisor if either job is accepted. Furthermore,additional insurance will be required if either job is accepted. The revenue and costs associated with each job follow.Cost CategoryContract priceUnit-level materials.Unit-level laborUnit-level overheadSupervisor's salaryRental equipment costsDepreciation on tools (zero market value)Allocated portion of company-wide facility-sustaining costsInsurance cost for jobRequireda. Assume that Fanning has decided to accept one of the two jobs. Fill in the information relevant to selecting one job versus theother. Recommend which job to accept.b. Assume that Job A is no longer available. Fanning's choice is to accept or reject Job B alone. Fill in the information relevant to thisdecision. Recommend whether to accept or reject Job B.Complete this question by entering your answers in the tabs below.Required A Required BDecisionJob A$805,000244,300250, 75018,000116,27025,70020,50011,80017,400Assume that Job A is no longer available. Fanning's choice is to accept or reject Job B alone. Fill in the information relevantto this decision. (Negative amounts should be indicated by a minus sign.)Contract priceUnit-level materialsUnit-level laborUnit-level overheadRental equipment costsDepreciation on tools (zero market value)Allocated portion of companywide facility-sustaining costsSupervisor's salaryInsurance cost for jobContribution to profit (loss)Recommend whether to accept or reject job B?< Required AJob BJob B$699,000225,050305,50014,000116,27027,70020,5009,80017,400Required BPrev3 of 30‒‒‒▬▬▬Next >

Answer - Contribution Per Unit or Total Contribution means the aggregate amount of Sales revenue available after variable costs and other costs to cover fixed expenses and provide profit to the company. Irrelevant costs are not useful or rather not at all considered because that will not change in the future when you make one business decision versus another.Answer - Part A - Calculation of Contribution to Profit/Loss : Decision: Assuming that Fanning Construction Company has decided to accept one of the two jobs, they shall accept Job A because Fanning to Profit is much higher than Job B. Here, Depreciation on tools and company-wide facility sustaining fixed costs are not relevant because it is sunk cost they will incur with or without accepting these projects. Part B - Calculation of Contribution to Profit/Loss : Decision: If Fanning Construction Company's choice is to accept or reject Job B alone, they should Reject it. Because, Contribution calculated above is Negative, Hence it should be rejected.