1. (20 pts.) A company manufactures two products, Simple and Complex. The following information was gathered: Selling price per unit Variable cost per unit Labor required (hours) Total fixed costs are $18,000. Assume that the company has 50,000 hours of labor available. Simple $37.00 32.00 Complex $26.00 22.00 10 Should the Simple or Complex product be produced and sold to maximize profis? (10 pts) Each year, Ace Inc. purchases 8,000 units of a part. The supplier notified Ace that a price increase will take effect shortly, which will bring the price of the part to $25 each. Ace is considering the use of idle facilities to produce the part. The annua production costs for the 8,000 parts are as follows: 2. Direct materials Direct labor Indirect production costs - variable Indirect production costs fixed $17,500 30,000 14,000 33,500 The idle facilities could also be rented out at an annual rent of $99,000. All the fixed indirect production costs are avoidable. Should Ace buy the part, produce it internally, or buy it and rent the facility? 3. (10 pts) Taurus Company has the following data: Month January February March April Budgeted Sales $108,000 132,000 144,000 120,000 The gross profit rate is 40% of sales and ending inventory at December 31 was $19,440. Desired ending inventory levels are 30% of next month's sales at cost. What are the expected total purchases for February