Question Details

(Solution Download) Chef Gourmet, Inc., has assembled the following data pertaining to its two most popular products. Bl


 

 

 

 

 

 

 

Chef Gourmet, Inc., has assembled the following data pertaining

 

to its two most popular products.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BlenderFood

 

Processor

 

  Direct material

 

$

 

26

 

$

 

45

 

  Direct labor

2033

 

  Manufacturing overhead @ $54 per machine hour

54108
  Cost

 

if purchased from an outside supplier

68116

 

  Annual demand (units)

28,00034,000

 

 

 

 

 

 

 

 

 

 

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?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BlenderFood Processor
Manufactured030,000
Purchased28,000?

 

I got the values for everything except the number of units

 

purchased for the food processor. How do I get that?

 

 


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