Question

ACCT 203 Managerial accounting help

Tesla, Inc. is deciding whether to outsource the production of a steering wheel that is included in all of its products. It currently costs Tesla $4.20 to make each steering wheel in-house. If Tesla outsources, it can buy the steering wheel ready-made for $3.90 each and can shut down the production facilities it is currently using to manufacture the steering wheel and save $20,000 a year in fixed costs. Annual requirement for the steering wheel is 12,000 units. What is the effect of outsourcing? 


How much to make?

How much to buy?

Should they outsource?

1 0
Add a comment Improve this question Transcribed image text
Request Professional Answer

Request Answer!

We need at least 10 more requests to produce the answer.

0 / 10 have requested this problem solution

The more requests, the faster the answer.

Request! (Login Required)


All students who have requested the answer will be notified once they are available.
Know the answer?
Add Answer to:
ACCT 203 Managerial accounting help
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Similar Homework Help Questions
  • 3. Pamper Chef is deciding whether to outsource the production of a certain component that is...

    3. Pamper Chef is deciding whether to outsource the production of a certain component that is included in all of its products. It currently costs Pamper Chef $1.20 to make each component in-house. If Pamper Chef outsources, it can buy the component ready-made for $0.90 each and can shut down the production facilities it is currently using to manufacture the component and save $20,000 a year in fixed costs. Annual requirement for the component is 12,000 units. What is the...

  • F Question 3: Make versus buy You make refrigerators. Currently, you manufacture compressors for your refrigerators...

    F Question 3: Make versus buy You make refrigerators. Currently, you manufacture compressors for your refrigerators in-house. An outside supplier has offered to sell you equivalent compressors at a wholesale price of $85 per unit. You need 1,000 compressors per month. The internal production costs per compressor are as follows: cost per unit direct materials $30 direct labor $30 variable overhead $20 fixed overhead $10 total $90 If you outsource the production of compressors (the buy option) in the short...

  • Question 3: Make versus buy You make refrigerators. Currently, you manufacture compressors for your refrigerators in-house....

    Question 3: Make versus buy You make refrigerators. Currently, you manufacture compressors for your refrigerators in-house. An outside supplier has offered to sell you equivalent compressors at a wholesale price of $75 per unit. You need 1,000 compressors per month. The internal production costs per compressor are as follows: cost per unit direct materials $20 direct labor $30 variable overhead $20 fixed overhead $20 total $90 If you outsource the production of compressors (the buy option) in the short term,...

  • Question 3: Make versus buy You make refrigerators. Currently, you manufacture compressors for your refrigerators in-house....

    Question 3: Make versus buy You make refrigerators. Currently, you manufacture compressors for your refrigerators in-house. An outside supplier has offered to sell you equivalent compressors at a wholesale price of $95 per unit. You need 1,000 compressors per month. The internal production costs per compressor are as follows: cost per unit direct materials $40 direct labor $40 variable overhead $10 fixed overhead $30 total $120 If you outsource the production of compressors (the buy option) in the short term,...

  • You make refrigerators. Currently, you manufacture compressors for your refrigerators in-house. An outside supplier has offered...

    You make refrigerators. Currently, you manufacture compressors for your refrigerators in-house. An outside supplier has offered to sell you equivalent compressors at a wholesale price of $85 per unit. You need 1,000 compressors per month. The internal production costs per compressor are as follows: cost per unit direct materials $30 direct labor $30 variable overhead $20 fixed overhead $20 total $100 If you outsource the production of compressors (the buy option) in the short term, how will this choice affect...

  • X−Perience manufactures snowboards. Its cost of making 1,900 bindings is as​ follows: Direct materials $17,540 Direct...

    X−Perience manufactures snowboards. Its cost of making 1,900 bindings is as​ follows: Direct materials $17,540 Direct labor 3,300 Variable overhead 2,110 Fixed overhead 6,500 Total manufacturing costs for 1,900 bindings $29,450 Suppose Witherspoon will sell bindings to X−Perience for $ 13 each. X−Perience would pay $ 3 per unit to transport the bindings to its manufacturing​ plant, where it would add its own logo at a cost of $0.50 per binding. Requirement 1. X−Perience's accountants predict that purchasing the bindings...

  • Question 3: Make versus buy You make refrigerators. Currently, you manufacture compressors for your refrigerators in-house....

    Question 3: Make versus buy You make refrigerators. Currently, you manufacture compressors for your refrigerators in-house. An outside supplier has offered to sell you equivalent compressors at a wholesale price of $65 per unit. You need 1,000 compressors per month. The internal production costs per compressor are as follows: cost per unit direct materials $20 direct labor $20 variable overhead $20 total If you outsource the production of compressors (the buy option) in the short term, how will this choice...

  • Outdoor Fun manufactures snowboards. Its cost of making 24,900 bindings is as follows: E: (Click the...

    Outdoor Fun manufactures snowboards. Its cost of making 24,900 bindings is as follows: E: (Click the icon to view the costs.) Suppose an outside supplier will sell bindings to Outdoor Fun for $14 each. Outdoor Fun will pay $1.00 per unit to transport the bindings to its manufacturing plant, where it will add its own logo at a cost of $0.30 per binding. Read the requirements. Data Table Direct materials ............. $ Direct labor Variable manufacturing overhead Fixed manufacturing overhead...

  • Mountain Fun manufactures snowboards. Its cost of making 19,000 bindings is as follows: E (Click the...

    Mountain Fun manufactures snowboards. Its cost of making 19,000 bindings is as follows: E (Click the icon to view the costs.) Suppose an outside supplier will sell bindings to Mountain Fun for $17 each. Mountain Fun will pay $3.00 per unit to transport the bindings to its manufacturing plant, where it will add its own logo at a cost of $0.40 per binding. Read the requirements. Requirement 1. Mountain Fun's accountants predict that purchasing the bindings from the outside supplier...

  • Mountain Fun manufactures snowboards. Its cost of making 23,600 bindings is as follows: (Click the icon...

    Mountain Fun manufactures snowboards. Its cost of making 23,600 bindings is as follows: (Click the icon to view the costs.) Suppose an outside supplier will sell bindings to Mountain Fun for $13 each Mountain Fun will pay $1.00 per unit to transport the bindings to its manufacturing plant, where it will add its own logo at a cost of $0.20 per binding. Read the requirements boards - X S.) Data Table spor ell bind o at a Utrect materials Direct...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT