#36-E12-10(1) 1 Futura Company purchases the 66,000 starters that it installs in its standard line of farm tractors from a supplier for the price of $12.50 per unit. Due to a reduction in output, the company now has idle capacity that could be used to produce the starters rather than buying them from an outside supplier. However, the company's chief engineer is opposed to making the starters because the production cost per unit is $12.70 as shown below: Direet labor 2.20 1.50 $ 99,000 1.30 85, 800 Depreciation 0.30 0.40 26,400 total product cost 12.70 If Futura decides to make the starters, a supervisor would have to be hired (at a salary of $99,000) to oversee production However, the company has sufficient idle tools and machinery such that no new equipment would have to be purc Referces If Futura decio charoge above is basedon space utlized in the plant. The total rent on the plant s $87000 per period. Depreciation is due to obsolescence rather than wear and tear 66000 starters instead of buying them from an outside supplier? What is the financial advantage (disadvantage) of making the