Question

requirmemt 3

Save omework: Chapter 08 Graded Homework core: 5.57 of 6 pts 4 of 5 (5 complete) E8-28A (similar to) HW Score: 94.97%, 28.49 of 30 pts Question Help GlobalSystems manufactures an optical switch that it uses in its final product. Global Systems incurred the following manufacturing costs when it produced 68.000 units last year: 318 (Click the icon to view the manufacturing costs.) GlobalSystems does not yet know how many ruches it will need this year, however, another company has offered to sel Globo Systems thatch for $16.00 per unit. If Global Systems buys the switch from the outside suppler, the manufacturing facices that wil belde cannot be used for any other purpose, yet none of the feed costs are avoidable. Read the requirements Variable cost per unit Units needed Total variable costs switches switches 12.50 $ 16.00 73.000 73.000 912.500 1.168.000 408.000 303,000 $ 1320,500 5 1,471000 Fixed costs Total relevant costs Decision Make the optical switch because the total relevant costs to make the switches are than the total relevant costs to buy the swiches Requirement 3. Given the last scenario, what is the most Global Systems would be willing to pay to outsource the switches? Begin by identifying the basic formula that is used to determine the indiferent outsourcing cost per unit Cost making switches Cost outsourcing sites Variable costs + Fixed costs Variable costs + Food Cou Using the basic formula you determined above, solve for the outsourcing cost of which obytoms would be inderen en oraing and making the rest che e r your pers on to the Global Systems would be indifferent between outsourcing and making the switches the outsourcing cost was per switch. Therefore. Systems will only be willing to outsource in the outsourcing costs Check Answer cho Answer Clear All 2020 Choose from any list or enter any number in the input fields and then All parts showing

Answer 1

Outsourcing cost was $1329500-303000 = $1026500

Cost per unit = $1026500/73000 = $14.06 per switch