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ACCT 5 13 1 Collected Homework Assignment #3 Fall 2021 See the Course Schedule in the syllabus for the due date. Put your answer underneath
ACCT 5 13 1 Collected Homework Assignment #3 Fall 2021 See the Course Schedule in the syllabus for the due date. Put your answer underneath each question. You may either type your answers in a Word le or write them neatly. However, to receive credit, your work must be easy to follow and your writing must be readable. Assignment Bernard Company manufactures 15,000 units of part A8 each year for use on its production line. The cost per unit of A8 is as follows: Direct materials ..................................................................... $2.40 Direct manufacturing labor ...................................................... 4.50 Variable manufacturing overhead ............................................ 1.60 Fixed manufacturing overhead ................................................ 6. 00 Total cost per part ...................................................... $14. 50 An outside supplier has offered to sell 15,000 units of part A8 each year to Bernard Company for $15.00 per part. If Bernard Company accepts this offer, the facilities now being used to manufacture part A8 could be rented to another company at an annual rental of $80,000. However, Bernard Company has determined that $3.50 of xed manufacturing overhead allocated to part A8 would continue even if part A8 were purchased from an outside supplier. Bernard's direct manufacturing labor consists of temporary help. Thus, Bernard can hire and dismiss those workers at will. Required: 2. Should Bernard Company accept the outside company's offer? Why or why not? Show ................................................ supporting computations
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