Chapter 12 Homework Assignment Saved Help Save&Exit Check my w Exercise 12-3 Make or Buy Decision [LO12-3] in heavy equipment. The company has always produced all of the necessary parts for its engines, including alor necessary parts for its engines, including all of the carburetors. An outside supplier has offered to sell one type of carburetor to Troy 2.5 points Engines, Ltd, for a cost of $34 per unit. To evaluate this offer. Troy Engines, Ltd, has gathered the following information relating own cost of producing the carburetor internally Skipped 19,000 Units Per Unit Per Year 516 304,009 Direct materials Direct labor Variable manufacturing overhead Pixed manufacturing overhead, traceable Pixed nanufacturing overhead, allocated Total cost eBook Hint Print 10 190,000 238,000 9 171,000 12 49 931,000 One- third supervisory salaries; two-thirds depreciation of special equipment (no resale value) Required: 1. Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the financial advantage (disadvantage) of buying 19,000 carburetors from the outside supplier? 2. Should the outside supplier's offer be accepted? 3 Suppose that if the carburetors were purchased, Troy Engines, Ltd, could use the freed capacity to launch a new product The segment margin of the new product would be $190,000 per year. Siven this new assumption, what would be the financial advantage (disadvantage) of buying 19,000 carburetors from the outside supplier? 4. Given the new assumption in requirement 3, should the outside supplier's offer be accepted? Required 1 Required 2 Required 3 Required 4 es Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the financial advantage (disadvantage) of buying 19,000 carburetors from the outside supplier Required 2> Financial (disadvantage) Financial advantage Required 1Required 2 Required 3 Required 4 Suppose that if the carburetors were purchased, Troy Engines, Ltd., could use the freed capacity to launch a new product. The segment margin of the new product would be $190,000 per year. Given this new assumption, what would be the financial advantage (disadvantage) of buying 19,000 carburetors from the outside supplier? Required 2 Required 4 Financial (disadvantage) Financial advantage