Data table

Done

Wild Ride manufactures snowboards. Its cost of making $1,700$ bindings is as follows:

$($Click the icon to view the costs.$)$

Suppose Lewis will sell bindings to Wild Ride for $$12$ each. Wild Ride would pay $$3$ per unit to transport the bindings to its manufacturing plant, where it would add its own logo at a cost of $$0\mathrm{.}40$ per

binding.

Read the requirements

Requirement $1.$ Wild Ride's accountants predict that purchasing the bindings from Lewis will enable the company to avoid $$2,000$ of fixed overhead. Prepare an analysis to show whether Wild Ride

should make or buy the bindings. $($Only enter the net relevant costs. For the Difference column, use a minus sign or parentheses only when the cost of outsourcing exceeds the cost of making the

should make or buy bindings in$-$house.$)$

Should Wild Ride make or buy the binding:

Requirement $2.$ The facilities freed by purchasing bindings from Lewis can be used to manufacture another product that will contribute $$2,900$ to profit. Total fixed costs will be the same as if

Wild Ride had produced the bindings. Show which alternative makes the best use of Wild Ride's facilities. $($Only enter the net relevant costs. Enter all costs as positive values. Use a minus sign or

parentheses for decreases to net costs.$)$

Variable Costs:

Direct materials

Direct labor

Variable overhead

Fixed costs

Purchase price from Lewis

Transportation

Logo

Expected profit from new product

Expected net cost of obtaining $1,700$ bindings

Expected

Which alte

Decisior

$\backslash$table$[[$rurcilase$],[$Transpor$],[$Logo$],[$Expected$],[$Expected$],[$Which alte$],[$Decisior$]]$

Buy the binding and leave the facilities idle.

Buy the binding and use the facilities to make the other product.

Make the bindings.