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EXPLAIN IN DETAILS PLEASE Paper Moon, a manufacturer of outdoor lighting fixtures is operating at less than full capacity. The plant manager is considering making
EXPLAIN IN DETAILS PLEASE
Paper Moon, a manufacturer of outdoor lighting fixtures is operating at less than full capacity. The plant manager is considering making the mounting brackets now being purchased from a supplier at $8.10 each. Paper Moon already has the equipment to produce the brackets. The plant manager has analyzed the cost of producing the brackets and determined that each bracket will require $1.90 of direct material, $0.80 of direct labor, and $9.00 of manufacturing overhead. Seventy-five percent of the manufacturing overhead is a fixed cost that would not be affected by the decision to manufacture the brackets. Should Paper Moon continue to purchase the brackets or produce them internally? (Round answers to 2 decimal places, eg. 1.64) Make Buy Costs per units Paper Moon A continue to purchase the part from an outside supplierStep by Step Solution
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