B Final Exam (50%) - FINC1001( [h Take Test: Begin Final Exam - FIX O & https://uws.westernsydney.edu.au/webapps/assessment/take/take.jsp?course_assessment_id=_142057_1&course_id=_402320

Exam (50%) FINCIOOI J X Tako Test: Begin Final Exam - O https://vuws. westernsydney.edu.au Remaining Time: 2 hours, 01 minute, 45 seconds. Question Completion Status: Question 5 10 points Saue Answer Thomas Engines Limited manufactures a variety of engines for use in heavy equipment. The company has always produced all of the necessary parts for its engines, including ail the carburettors. An outside supplier has offered to sell one type of carburettor to the company for a cost of $40 per unit. To evaluate this offer, the company has gathered the following information relating to its own cost of producing the carburettor internally: Direct materials Direct labour Variable manufacturing overhead Fixed manufacturing overhead, traceable Fixed manufacturing overhead, allocated Total cost per Unit $16 12 4 9_ 10 $51 20,000 Units per Year $320,000 $240,000 80,000 180,000 200,000 -third supensory salaries; two-thirds depreciation of special equipment (no resale value). , quired: A1. Assuming *he company has no alternative use for the facilities that are now being used to produce the carburettors, what would be the financia\ advantage (di%Hva1itgge) of buying 20,000 carburettors from the outside supplier? (6 marks) 2. Stk 'dd outside supplier's offer be accepted? (1 mark) 3. S&noose that if the carburettors were purchased, the company could use the freed capacity to launch a new product. The segment margin of the new be $73000 per year. Given this new assumption, what would be financial advantage (disadvantage) of buying 20,000 carburettors from the outside supp\ier2 marks) For the toolbar, press ALT+FIO (PQ or ALT+FN+FIO (Mac). B U -9 Paragraph Open Sans,s... 10pt