Maurice Tutor

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Category > Accounting Posted 17 Aug 2017 My Price 11.00

Chef Gourmet, Inc.

Chef Gourmet, Inc., has assembled the following data pertaining to its two most popular products.

 

  Blender Food Processor
  Direct material $ 26   $ 45  
  Direct labor   20     33  
  Manufacturing overhead @ $54 per machine hour   54     108  
  Cost if purchased from an outside supplier   68     116  
  Annual demand (units)   28,000     34,000  
 

Past experience has shown that the fixed manufacturing overhead component included in the cost per machine hour averages $42. Management has a policy of filling all sales orders, even if it means purchasing units from outside suppliers.

2. With all other things constant, if management is able to reduce the direct material for a food processor to $26 per unit, how many units of each product should be manufactured? Purchased?
  Blender Food Processor
Manufactured 0 30,000
Purchased 28,000 ?

I got the values for everything except the number of units purchased for the food processor. How do I get that?

Answers

Maurice Tutor
(5)
Status NEW Posted 17 Aug 2017 06:08 PM My Price 11.00

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