$ 5.20 3.60 I en Industries, which manufactures and sells a highly successful line of summer lotions and insect repellents, has decided to ersity in order to stabilize sales throughout the year. A natural area for the company to consider is the production of winter ons and creams to prevent dry and chapped skin. er considerable research, a winter products line has been developed. However, Silven's president has decided to introduce y one of the new products for this coming winter. If the product is a success, further expansion in future years will be initiated e product selected (called Chap-Off) is a lip balm that will be sold in a lipstick-type tube. The product will be sold to olesalers in boxes of 24 tubes for $12 per box. Because of excess capacity, no additional fixed manufacturing overhead costs be incurred to produce the product. However, a $103,500 charge for fixed manufacturing overhead will be absorbed by the bduct under the company's absorption costing system ing the estimated sales and production of 115,000 boxes of Chap-Off, the Accounting Department has developed the owing manufacturing cost per box: Direct material birect labor Manufacturing overhead 2.20 otal cost $. 11.00 e costs above relate to making both the lip balm and the tube that contains it. As an alternative to making the tubes for Chap Silven has approached a supplier to discuss the possibility of buying the tubes. The purchase price of the supplier's empty es would be $1.90 per box of 24 tubes. If Silven Industries stops making the tubes and buys them from the outside supplier direct labor and variable manufacturing overhead costs per box of Chop-off would be reduced by 10% and its direct materials sts would be reduced by 25%. quired: Silven buys its tubes from the outside supplier, how much of its own Chap-Off manufacturing costs per box will it be able to old? (Hint: You need to separate the manufacturing overhead of $2.20 per box that is shown above into its variable and fixed mponents to derive the correct answer) What is the financial advantage (disadvantage) per box of Chap-Off if Silven buys its tubes from the outside supplier? What is the financial advantage (disadvantage) in total (not per box) if Silven buys 115,000 boxes of tubes from the outside pplier? Should Silven Industries make or buy the tubes? What is the maximum price that Silven should be willing to pay the outside supplier for a box of 24 tubes? Instead of sales of 115,000 boxes of tubes, revised estimates show a sales volume of 143,000 boxes of tubes. At this higher es volume, Silven would need to rent extra equipment at a cost of $48,000 per year to make the additional 28,000 boxes of pes. Assuming that the outside supplier will not accept an order for less than 143,000 boxes of tubes, what is the financial vantage (disadvantage) in total (not per box) if Silven buys 143,000 boxes of tubes from the outside supplier? Given this new aminton ha Clin Inrinteinem Arhaith the O is direct laborah costs would be reduced by 25% S Required: 1. Silvon buys its tubes from the outside supplier, how much of its own Chap-Off manufacturing costs per box will it be able to avoid? (Hint: You need to separate the manufacturing overhead of $2.20 per box that is shown above into its variable and fixed components to derive the correct answer) 2. What is the financial advantage (disadvantage) per box of Chop-Off if Silven buys its tubes from the outside supplier? 3. What is the financial advantage (clisadvantage) in total (not per box) if Silven buys 115,000 boxes of tubes from the outside supplier? 4. Should Silven Industries make or buy the tubes? 5. What is the maximum price that Silven should be willing to pay the outside supplier for a box of 24 tubes? 5. Instead of sales of 115,000 boxes of tubes, revised estimates show a sales volume of 143,000 boxes of tubes. At this higher Sales volume, Silven would need to rent extra equipment at a cost of $48,000 per year to make the additional 28,000 boxes of tubes. Assuming that the outside supplier will not accept an order for less than 143,000 boxes of tubes, what is the financial advantage (disadvantage) in total (not per box) Sliven buys 143,000 boxes of tubes from the outside supplier? Given this new Information should Silven Industries make or buy the tubes? Refer to the data in Required 6. Assume that the outside supplier will accept an order of any size for the tubes at a price of $190 per box. How many boxes of tubes should Silven make? How many boxes of tubes should it buy from the outside supplier? Complete this question by entering your answers in the tabs below. Reg 1 Reqs Reg 2 Req3 Reg 4 Reg 6 Req7 If Sliven buys its tubes from the outside supplier, how much of its own Chap-Off manufacturing costs per box will it be able to avoid? (Hint: You need to separate the manufacturing overhead of $2.20 per box that is shown above into its variable and fixed components to derive the correct answer.) (Do not round Intermediate calculations, Round your answer to 2 decimal places.) Show less Avoidable manufacturing costs per box of Chap-off Reg Req 2 >