Industrial Products, Inc. has two alternatives for manufacturing 12,000 industrial 100-horse power electric motors per year. If
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Industrial Products, Inc. has two alternatives for manufacturing 12,000 industrial 100-horse power electric motors per year. If done in-house, fixed cost would be $2,100,000 with variable cost at $6,800 per unit. Alternative two is to outsource for a total cost of $7,300 per unit. The relevant formulas can be found in Supplement C: Break-Even Analysis
a. What is the break-even quantity?
b. Should the firm make-in-house or outsource?
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Related Book For
Operations And Supply Chain Management
ISBN: 9780357131695
2nd Edition
Authors: David A. Collier, James R. Evans
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