Question

H . . HOME FILE INSERT PAGE LAYOUT Prepare a make or buy analysis - Excel FORMULAS DATA REVIEW ? - Cabe 6 VIEW Paste Sign In BIU R A Alignment Number Clipboard Font Conditional Format as Cell Formatting Table Styles Cells Editing 036 Styles 14 Units used per year 12,000 16 "Fixed manufacturing overhead, traceable is composed of two items: Depreciation of equipment (no resale value) Supervisor salary 20 1. Assuming the company has no alternative use for the facilities now being used to produce the 21 component, complete the following analysis to determine if the outside supplier's offer should be accepted. 30% 70% Per Unit Differential Cost Make Buy 12,000 units Make Buy Cost of purchasing Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead, traceable Fixed manufacturing overhead, common Total costs 6.00 2.00 34 Based on this analysis, write an if statement to determine if Alanco should make or buy the component. 15.50 Sheet READY A ) 8/10

Answer 1

				Per unit differential cost		12,000 Units
				Make	Buy	Make	Buy
Cost of purchasing					$ 21.0		$ 252,000
Direct materials				$    4.0		$    48,000
Direct labor				$    6.0		$    72,000
Variable manufacturing overhead				$    2.0		$    24,000
Fixed manufacturing overhead, Treacable				$    3.5		$    42,000
Fixed manufacturing overhead, Common				$    8.0		$    96,000
Total costs				$ 23.5		$ 282,000

Excel Link

				Per unit differential cost		12,000 Units
				Make	Buy	Make	Buy
Cost of purchasing					=F12		=F26*F14
Direct materials				=G5		=E27*F14
Direct labor				=G6		=E28*F14
Variable manufacturing overhead				=G7		=E29*F14
Fixed manufacturing overhead, Treacable				=G8*(100%-F17)		=E30*F14
Fixed manufacturing overhead, Common				=G9		=E31*F14
Total costs				=SUM(E27:E31)		=SUM(G27:G31)

You can reach me over comment box if you have any doubts. Please rate this answer