Brief Exercise 20-4

Partially correct answer. Your answer is partially correct. Try again.

Manson Industries incurs unit costs of $7 ($4 variable and $3 fixed) in making an assembly part for its finished product. A supplier offers to make 10,900 of the assembly part at $5 per unit. If the offer is accepted, Manson will save all variable costs but no fixed costs. Prepare an analysis showing the total cost saving, if any, Manson will realize by buying the part. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Make Buy Net Income

Increase (Decrease)

Variable manufacturing costs $Entry field with incorrect answer $Entry field with correct answer $Entry field with incorrect answer

Fixed manufacturing costs Entry field with incorrect answer Entry field with incorrect answer Entry field with correct answer

Purchase price Entry field with correct answer Entry field with incorrect answer Entry field with incorrect answer

Total annual cost $Entry field with incorrect answer $Entry field with incorrect answer $Entry field with incorrect answer

The decision should be to Entry field with correct answer the part.

Brief Exercise 20-4 Your answer is partially correct. Try again. Manson Industries incurs unit costs of $7 ($4 variable and $3 fixed) in making an assembly part for its finished product. A supplier offers to make 10,900 of the assembly part at $5 per unit. If the offer is accepted, Manson will save all variable costs but no fixed costs. Prepare an analysis showing the total cost saving, if any, Manson will realize by buying the part. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45) Net Income Increase (Decrease) Make Buy Variable manufacturing costs Fixed manufacturing costs Purchase price Total annual cost The decision should be to the part. Click if you would like to Show Work for this question Open Show Work By accessing this Question Assistance, you will learn while you earn points based on the Point Potential Policy set by your instructor