Prepare a report as described in the attached Brookfield Gearbox Products case.Your report should be about two to three pages typed plus appropriate exhibits

ACI Accounting Case Institute The Atlantic Home For Accounting Case Studies Brookfield Gearbox Products Brookfield Gearbox Products (BGP) manufactures a broad line of gearboxes for cars trucks, and recreational vehicles. BGP is segmented into three major responsibility centers: Grinding, Forming, and Assembly. Each gearbox must spend a certain amount of time in each of the three departments before it can be shipped to the customer. Inspection takes place in the assembly department and is extremely important because the customers major auto and truck manufacturers and some small independent specialty producers demand zero defects in products received Recently, the owner of BGP has become concerned with the results the firm is achieving According to Mary Paulson, the newly elected president and majority shareholder, sale volume is increasing but profits are falling rapidly. The two major products are the standard" and the "deluxe" gearbox, which account for 90% of total sales volume (the remaining products are small and can be ignored for the remainder of this question) Sales for the "deluxe" gearbox have been growing rapidly, to the point where the firm sold twice its usual number in the last six months (this trend has been evident for about two years). Severe price competition has caused BGP to drastically cut the price of its major product, the "standard" gearbox There is little information concerning the production costs related to specific products An engineering study was performed three months ago, at the suggestion of the auditors but nothing has been done with the information. A summary of the engineering study results follows Raw materials for the standard" gearbox consist of 18 pounds of metal. There is no wastage or spoilage with respect to a "standard" gearbox. Twenty-two pounds of metal are used to manufacture a good unit of the "deluxe" gearbox (the proce SS begins with 22 pounds but 9.09% of the raw material is deemed to be unusable and is scrapped; the company receives no revenue for these scrapped materials The hourly rate (including fringe benefits of $2.76 per hour for direct labor varies among the departments and between the products. The engineering study also determined how much time is generally taken in each department to produce o unit of product. These times and rates are indicated below Deluxe Standard Grind Form Assemble Grind Form Assemble Direct labor hours 4.0 8.0 2.0 5.0 10.0 10.0 Direct labor rate/DLH $8.00 $10.00 $12.00 $12.00 $14.00 $16.00