Solution 1:
Particulars | Make | Buy | Difference in Cost |
Direct materials | $325,000.00 | $0.00 | $325,000.00 |
Direct labor | $150,000.00 | $0.00 | $150,000.00 |
Variable overhead | $50,000.00 | $0.00 | $50,000.00 |
Fixed overhead | $200,000.00 | $200,000.00 | $0.00 |
Purchase price | $0.00 | $550,000.00 | -$550,000.00 |
Total annual costs | $725,000.00 | $750,000.00 | -$25,000.00 |
Solution 3a:
Particulars | Make | Buy | Difference in Cost |
Direct materials | $325,000.00 | $0.00 | $325,000.00 |
Direct labor | $150,000.00 | $0.00 | $150,000.00 |
Variable overhead | $50,000.00 | $0.00 | $50,000.00 |
Fixed overhead | $200,000.00 | $200,000.00 | $0.00 |
Purchase price | $0.00 | $550,000.00 | -$550,000.00 |
Opportunity cost | $0.00 | -$41,000.00 | $41,000.00 |
Total annual costs | $725,000.00 | $709,000.00 | $16,000.00 |
2.00 points Required information E7-6 Analyzing Make-or-Buy Decision [LO 7-2, 7-4) MSI is considering outsourcing the...
E7-6 Analyzing Make-or-Buy Decision [LO 7-2, 7-4] MSI is considering outsourcing the production of the handheld control module used with some of its products. The company has received a bid from Monte Legend Co. (MLC) to produce 20,000 units of the module per year for $20.00 each. The following information pertains to MSI's production of the control modules: $10 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit $27 MSI has determined that it could...
E7-6 Analyzing Make-or-Buy Decision [LO 7-2, 7-4 MSI is considering outsourcing the production of the handheld control module used with some of its products. The company has received a bid from Monte Legend Co. (MLC) to produce 25,000 units of the module per year for $22.00 each. The following information pertains to MSI's production of the control modules: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit $13 6 8 $29 MSI has determined that...
6. 200 points Required information E7-6 Analyzing Make-or-Buy Decision [LO 7-2, 7-4) MSI is considering outsourcing the production of the handheld control module used with some of its products. The company has received a bid from Monte Legend Co. (MLC) to produce 10,000 units of the module per year for $16.00 each. The following information pertains to MSi's production of the control modules Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit MSI has determined...
MSI is considering outsourcing the production of the handheld control module used with some of its products. The company has received a bid from Monte Legend Co. (MLC) to produce 18,000 units of the module per year for $25.00 each. The following information pertains to MSI's production of the control modules: $19 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit MSI has determined that it could eliminate all variable costs if the control modules...
MSI is considering outsourcing the production of the handheld control module used with some of its products. The company has received a bid from Monte Legend Co. (MLC) to produce 13,000 units of the module per year for $26.00 each. The following information pertains to MSi's production of the control modules: $14 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit MSI has determined that it could eliminate all variable costs if the control modules...
MSI is considering outsourcing the production of the handheld control module used with some of its products. The company has received a bid from Monte Legend Co. (MLC) to produce 23,000 units of the module per year for $24.00 each. The following Information pertains to MSI's production of the control modules: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit MSI has determined that it could eliminate all variable costs if the control modules were...
MSI is considering outsourcing the production of the handheld control module used with some of its products. The company has received a bid from Monte Legend Co. (MLC) to produce 18,000 units of the module per year for $25.00 each. The following information pertains to MSi's production of the control modules: $10 7 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit 8 MSI has determined that it could eliminate all variable costs if the...
MSI is considering outsourcing the production of the handheld control module used with some of its products. The company has received a bid from Monte Legend Co. (MLC) to produce 23,000 units of the module per year for $24.00 each. The following information pertains to MSI's production of the control modules: Direct materials Direct labor $13 4 6 Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit $27 MSI has determined that it could eliminate all variable costs if...
MSI is considering outsourcing the production of the handheid control module used with some of its products. The company has received a bid from Monte Legend Co. (MLC) to produce 18,000 units of the module per year for $25.00 each. The following information pertains to MSi's production of the control modules. Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit $10 7 7 4 $28 MSI has determined that it could eliminate all variable costs...
MSI is considering outsourcing the production of the handheld control module used with some of its products. The company has received a bid from Monte Legend Co. (MLC) to produce 8.000 units of the module per year for $18.00 each. The following information pertains to Mars production of the control modules Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit MSI has determined that it could eliminate all variable costs if the control modules were...