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[15 points] Dipuisto-1616 Inc. manufactures radios at an annual production level of 50,000 units. At this production level, the cost per unit for a radio
[15 points] Dipuisto-1616 Inc. manufactures radios at an annual production level of 50,000 units. At this production level, the cost per unit for a radio is as follows: Direct materials $4.00 Direct labor $4.00 Variable manufacturing overhead $10 . 00 Supervisor's salary $6 . 00 Other fixed manufacturing overhead $8 . 00 Total cost per radio $32. 06 An outside supplier has offered to sell the radios to Dipuisto-1616 for $17 per unit. If Dipuisto-1616 accepts this offer it can use the radio production space as a warehouse instead, replacing the warehouse it currently rents for $70,000, If the radios are purchased from the outside supplier, 100% of the supervisor's salary and 40% of the other fixed manufacturing overhead costs can be eliminated What is the financial advantage of accepting the outside supplier's offer for Dipuisto-1616
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