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2 Futura Company purchases the 60.000 states that it installs in its standard line of farm tractors from a supplier for the price of $12.20
2 Futura Company purchases the 60.000 states that it installs in its standard line of farm tractors from a supplier for the price of $12.20 per unit Due to a reduction in output the company now has de capacity that could be used to produce the starters tamer than buying them from an outside supplies. However, the company's chief engineer is opposed to making the starters because the production cost per un is $12.20 as shown below. 10 $5.00 Direct salariato Direct labor Wisior Deprecation Variable manufacturin veral Sant total product cost 1.500,000 1.166,00 0.70 5 24,000 Futura decides to make the starters, supervisor would have to be hired at a salary of $90,000) to oversee production. However the company has sufficient de tools and machinery such that no new equipment would have to be purchased. The rent charge above steed on soce utilized in the plant. The totalrent on the plant is 587000 per period. Depreciation is due to obsolescence rather than wear and tear Required: What is the financial advantage disadvantages of making the 60.000 starters instead of buying them from an outside supplier
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