Homework: Week #3 Chapter #6 Homework Save Score: 0 of 2 pts 16 of 22 (19 complete) HW Score: 81 27%, 26 82 of 33 pts E6-32 (similar to) i Question Help * Assume that a division of Bose makes an electronic component for its speakers. A small local company has offered to supply the components at Its manufacturing process for the component is a highly automated part of a a price of $4 90 each If the division discontinued its production of the component, it would save one-half of the supplies cost and $28,000 of indirectHabor cost just-in-dime production system all overhead is regarded a for 80,000 units of the component are as follows: All labor is considered to be an overhead cost, and as fixed with respect to output volume. Production costs overhead costs would continue. The division manager recently attended a seminar on cost behavior and leamed about fixed and variable costs. He wants to continue because the variable cost of $3.80 is below the $4.90 bid EB (Click the icon to view the total production costs for 80.000 units,) to make the component the Read the tequitements Which altermative is less costly and by how much? (Leave unused cell blank. Enter the amounts as a positive number) (a) Make Direct materials 400000 Avoidable overhead costs Indirect labor 28000 Supplies Allocated occupancy cost Purchase cost Total relevant costs Enter any number in the edit fields and then click Check Answer Check Answer Clear All remaining ng. 16e to uul il ue uivision discontinued its production c uuelion gystem. All labor is considered to be an overhead cost, and one-half of the supplies cost and $28,000 of in s regarded as fixed with respect to output volume. Production costsoverhead costs would continue. The division ma ts of the component are as follows: icon to view the total production costs for 80.000 units.) on cost behavior and learned about fixed and va to make the component because the variable co i Data Table 1. Compute the relev e amounts as a posi ess costly and by h Direct materials s 400,000 ls Factory overhead rhead costs: Indirect labor $ 90,000 oor Supplies 21.000 50,000161,000 Allocated occupancy cost occupancy cost $ 561,000 Total cost costs Print Done nbet in the edit fields and then click Check Answer Clear All OJt ole-Hall of the supplies cost and $28,000 of indirect- overhead costs would continue. The division manager on cost behavior and learned about fixed and variable to make the component because the variable cost of $3 xed with respect to output volume. Production costs nent are as follows: e total production costs for 80,000 units) Read the requirements e relevant cost of (a making and (b) purchasing the component Which alternative is less costly and by how muc a positi Requirements 1. Compute the relevant cost of (a) making and (b) purchasing the component Which alternative is less costly and by how much? 2. What qualitative factors might influence the decision about whether to make or to buy the component? Print Done lt fields and then click Check