2.

Recher Corporation uses part Q89 in one of its products. The company's Accounting Department reports the following costs of producing the 8,100 units of the part that are needed every year. Per Unit Direct materials 6.20 $3.40 6.70 $2.50 S 2.10 Direct labor Variable overhead Supervisor's salary Depreciation of special equipment Allocated general overhead $1.10 An outside supplier has offered to make the part and sell it to the company for $23.00 each. If this offer is accepted, the supervisor's salary and all of the variable costs, including direct labor, can be avoided. The special equipment used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represents fixed costs of the entire company. If the outside supplier's offer were accepted, only $3,700 of these allocated general overhead costs would be avoided. In addition, the space used to produce part Q89 could be used to make more of one of the company's other products, generating an additional segment margin of $16,500 per year for that product. Required: a. Prepare a report that shows the financial impact of buying part Q89 from the supplier rather than continuing to make it inside the company b. Which alternative should the company choose? Complete this question by entering your answers in the tabs below. Required A Required B Prepare a report that shows the financial impact of buying part Q89 from the supplier rather than continuing to make it inside the company. Make Buy Direct materials Direct labor Variable overhead Supervisor's salary Depreciation of special equipment Allocated general overhead Outside purchase price Opportunity cost Total cost Complete this question by entering your answers in the tabs below. Required A Required B Which alternative should the company choose? by The total cost of the "make" alternative is Therefore, the company should the part. Boney Corporation processes sugar beets that it purchases from farmers. Sugar beets are processed in batches. A batch of sugar beets costs $43 to buy from farmers and $14 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $19 or processed further for $18 to make the end product industrial fiber that is sold for $55. The beet juice can be sold as is for $38 or processed further for $22 to make the end product refined sugar that is sold for $55 What is the financial advantage (disadvantage) for the company from processing the intermediate product beet juice into refined sugar rather than selling it as is