Question

Send to Gradebook Question 2 View Polides Current Attempt in Progress Manson Industries incursun costs of $754 variable and found making an assembly part for its finished product A supplier offers to make 137 400 of the assembly part at $5 per unit. the offer is accepted. Manson will save all variable costs but nofoed costs. Prepare an analysis showing the total cost saving any Manson will realize by buying the part i ve munting either s preceding the number -45 or parentheses (450 Net Income Make Increase Decrease Varlable manufacturing costs s Fored manufacturing costs Purchase price Total anual cost The decision should be to Attempts of used FIGHT

Answer 1

	Make	Buy	Net income increase (decrease)
Variable manufacturing costs	$53,600		$53,600
Fixed manufacturing costs	$40,200	$40,200
Purchase price		$67,000	($67,000)
Total annual cost	$93,800	$107,200	($13,400)

The total cost to make is less than total cost to buy.

The decision should be to make the part.