A company is considering buying a part that they currently make for one of their products. The costs of producing the 8,800 units of the part that are needed every year are as follows Per Unit 5.6.20 Direct materials Direct labor Variable overhead Supervisor's salary Depreciation of special equipment Allocated general overhead 56.70 $ 2.50 $2.10 $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 the part 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. Calculate the financial advantage (disadvantage) of accepting the supplier's offer to purchase the port Financial advantage (Gnadvantage) is b. Should the company make or buy the part? the part The company should The following information is for a company that makes a variety of products. The company's predetermined overhead rate is $26 per direct labor-hour, which was calculated based on the following data. Variable manufacturing overhead Fixed manufacturing overhead Direct labor-hours $ 32,000 $384,000 16,000 Management is considering a special order for 800 units of one of their products at $74 each. The normal selling price of the product Is $85 and the unit product cost is determined as follows: Direct materials Direct labor Manufacturing overhead applied Unit product coot $ 47.00 18.00 26.00 5.91.00 If the special order were accepted, normal sales of this and other products would not be affected. The company has ample excess copacity to produce the additional units. Assume that direct labor is a variable cost, variable manufacturing overhead is really driven by direct lobor hours, and total fixed manufacturing overhead would not be affected by the special order. The customer wants a modification that would increase the direct materials cost by $.50 per unit. Because of the special-order customer's location, there would also be a fixed shipping cost of $150 to fulfill the order. Required: The financial advantage (disadvantage) for the company as a result of accepting this special order would be