Chocolates from Heaven Inc. (CFHI) produce small batch chocolate. It is a private company owned by 2 equal shareholders, David Chang and Sharjeel Ahmed. They started CFHI in 1996 and have grown a successful business. They intend to sell the business this year (2018) and already have an interested buyer. Collateral for the loan is inventory and accounts receivable. Audited financial statements are a requirement of the loan agreement. Your audit firm, MBA Class Audit has been appointed the new auditor this year. The previous auditor was a small local firm (sole practitioner) and the owner retired last year. The following are the draft partial financial statements for the year ended 2018. 2018 Unaudited Sales 2,469,974 Gross Margin 1,210,287 Operating Expenses 861,725 Loss Due to Fire 53,478 Operating Income 295,084 Interest Expense 8,000 Net Income Before Income Taxes 287,084 Income Taxes 43,063 Net Income After Taxes 244,021 Cash A/R net of Allowance for Doubtful Accounts Inventories Prepaid Expenses Property Plant and Equipment Net 297 411,662 104,974 55,678 1,445,260 You are the senior auditor assigned to the CFHI file to perform the materiality assessment. Prepare the materiality assessment and explain how materiality will impact your audit plan