Activity-Based Supplier Costing Bowman Compan ent, which is purchased from two local suppliers: Manzer Inc. and Buckner Company. Both suppiers are reliable an y manufactures cooling systems. Bowman produces all the parts necessary for its product except for one electronic Buckner Company. Both suppliers are reliable and seldom deliver late; however, Manzer sells the component for $89 per unit, while Buckner selis the same component for $86. Bowrman purchases 80% of its components from Buckner because of its lower price. The total annual demand is 4,000,000 components. To help assess the cost effect of the two components, the following data were collected for supplier-related activities and suppliers I. Activity Data Inspecting components (sampling only) Reworking products (due to failed component) Warranty work (due to failed component) II. Supplier Data Activity Cost $840,000 7,270,000 11,670,000 Buckner Manzer Inc. Company $86 800,000 3,200,000 3,920 $89 Units purchased 80 Sampling hours