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Adams Construction Company is a building contractor specializing in small commercial buildings. The company has...

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Accounting

Adams Construction Company is a building contractor specializing in small commercial buildings. The company has the opportunity to accept one of two jobs; it cannot accept both because they must be performed at the same time and Adams does not have the necessary 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 Category Job A Job B
Contract price $ 802,000 $ 684,000
Unit-level materials 244,200223,450
Unit-level labor 250,750305,300
Unit-level overhead 18,10013,300
Supervisors salary 115,270115,270
Rental equipment costs 26,10028,300
Depreciation on tools (zero market value)20,40020,400
Allocated portion of companywide facility-sustaining costs 10,50010,400
Insurance cost for job 16,70016,700
Required

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