# 42
Chef Gourmet, Inc., has assembled the following data pertaining to its two most popular products.
Blender Food Processor
Direct material $ 24 $ 41
Direct labor 18 31
Manufacturing overhead @ $50 per machine hour 50 100
Cost if purchased from an outside supplier 66 114
Annual demand (units) 26,000 30,000
Past experience has shown that the fixed manufacturing overhead component included in the cost per machine hour averages $36. Management has a policy of filling all sales orders, even if it means purchasing units from outside suppliers.
Required:
1.
If 51,000 machine hours are available, and management desires to follow an optimal strategy, how many units of each product should the firm manufacture? How many units of each product should be purchased?
Blender Food Procesor
Manufacture
Purchase
2.
With all other things constant, if management is able to reduce the direct material for a food processor to $24 per unit, how many units of each product should be manufactured? Purchased?
Blender Food Processor
Manufacture
Purchase
Audit Reports
Comp r ehensive Material Series Audit R eports 1) Explain why auditors’ reports are important to users of financial statements and why it is desirable to have standard wording. : Auditor's r eports a r e important to users of financial statements because they info r m users of the auditor's opinion as to whether or not the statements a r e fairly stated or whether no conclusion can be made with r ega r d to the fai r ness of their p r esentation . User s especiall y loo k fo r an y deviatio n f r o m th e wo r din g o f the standa r d unqualified r eport and the r easons and implications of such deviations. Having standa r d wo r ding imp r oves communications for the benefit of users of the auditor’s r eport. When the r e a r e departu r es f r om the standa r d wo r ding, users a r e mo r e li k e...
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