Homework: Week #3 Chapter #6 Homework Save Score: 0 of 2 pts 16 of 22 (15 complete) HW Score: 48.48%, 16 of 33 pts E6-32 (similar to) EQuestion Help Assume that a division of Bose makes an electronic component for its speakers. A small, loal company has offered to supply the components at a price of $4. 90 Its manufacturing process for the component is a highly automated part of a just-in-time production system. All labor is considered to be an overhead cost, and one-half of the supplies cost and $28,000 of indirect-labor cost All other all overhead is regarded as fixed with respect to output volume. Production costs overhead costs would continue. The division manager recently attiended a seminar for 80,000 units of the component are as follows Click the icon to view the total production costs for 80.000 units) each. If the division discontinued its production of the component, it would save on cost behavior and learned about fxed and variable costs. He wants to continue to make the component because the variable cost of $3.80 is below the $490 bid Read the cequirements Requirement 1. Compute the relevant cost of (a) making and (b) purchasing the component. Which alternative is less costly and by how much? (Leave unused cells blank. Enter the amounts as a positive number) (a) Make Direct materials 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 A small, local company has offered to sup each. If the division discontinued its produ one- half of the supplies cost and $28,00 overhead costs would continue. The divisi on cost behavior and learned about fixed a to make the component because the variak n electronic component for its speakers. nent is a highly automated part of a is considered to be an overhead cost, and spect to output volume. Production costs sfollows uct i Data Table and cost $ 400,000 Direct materials (a Factory overhead $90,000 Indirect labor 21,000 Supplies Allocated occupancy cost 30000 $561,000 Total cost Print Done nd then click Check Answer Clear All 16 or 22 (15 complete) e makes an electronic component for its speakers A small, local company has offered to each. If the division discontinued its p n. All labor is considered to be an overhead cost, and one- half of the supplies cost and $28 xed with respect to output volume. Production costs overhead costs would continue. The d on cost behavior and learned about fix to make the component because the va the component is a highly automated part of a nent are as follows: e total production costs for 80,000 units.) Requirements ne 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 ost edit fields and then click Check Answer Clear All