i 1 More Info Solar manufactured 9,000 CMCBs in 2017 in 50 batches of 180 each. In 2018, Solar anticipates needing 4,000 CMCBs. The CMCBs would be produced in 40 batches of 100 each. The Michigan Corporation has approached Solar about supplying CMCBs to Solar in 2018 at $290 per CMCB on whatever delivery schedule Solar wants. (Click the icon to view the make-versus-buy information.) The Solar Corporation manufactures cellular modems. It manufactures its own cellular modem circuit boards (CMCB), an important part of the cellular modem. It reports the following cost information about the costs of making CMCBs in 2017 and the expected costs in 2018: (Click the icon to view the costs.) Read the requirements. Manufacturing Total Manufacturing Costs of CMCB Cost per Unit Direct materials Direct manufacturing labor Variable batch manufacturing costs Fixed manufacturing costs Avoidable fixed manufacturing costs Unavoidable fixed manufacturing costs Total manufacturing costs Current Costs Expected Costs in 2017 in 2018 182 $ 165 41 29 Variable manufacturing costs Direct material cost per CMCB Direct manufacturing labor cost per CMCB Variable manufacturing cost per batch for setups, materials handling, and quality control Fixed manufacturing cost Fixed manufacturing overhead costs that can be avoided if CMCBs 1,500 1,300 are not made 630,000 140,000 Fixed manufacturing overhead costs of plant depreciation, - Requirements 1. Calculate the total expected manufacturing cost per unit of making CMCBs in 2018. 2. Suppose the capacity currently used to make CMCBs will become idle if Solar purchases CMCBs from Michigan. On the basis of financial considerations alone, should Solar make CMCBs or buy them from Michigan? Show your calculations. 3. Now suppose that if Solar purchases CMCBs from Michigan, its best alternative use of the capacity currently used for CMCBs is to make and sell special circuit boards (CB3s) to the Evening Corporation. Solar estimates the following incremental revenues and costs from CB3s: Total expected incremental future revenues $2,300,000 Total expected incremental future costs $2,400,000 On the basis of financial considerations alone, should Solar make CMCBs or buy them from Michigan? Show your calculations. i 1 More Info Solar manufactured 9,000 CMCBs in 2017 in 50 batches of 180 each. In 2018, Solar anticipates needing 4,000 CMCBs. The CMCBs would be produced in 40 batches of 100 each. The Michigan Corporation has approached Solar about supplying CMCBs to Solar in 2018 at $290 per CMCB on whatever delivery schedule Solar wants. (Click the icon to view the make-versus-buy information.) The Solar Corporation manufactures cellular modems. It manufactures its own cellular modem circuit boards (CMCB), an important part of the cellular modem. It reports the following cost information about the costs of making CMCBs in 2017 and the expected costs in 2018: (Click the icon to view the costs.) Read the requirements. Manufacturing Total Manufacturing Costs of CMCB Cost per Unit Direct materials Direct manufacturing labor Variable batch manufacturing costs Fixed manufacturing costs Avoidable fixed manufacturing costs Unavoidable fixed manufacturing costs Total manufacturing costs Current Costs Expected Costs in 2017 in 2018 182 $ 165 41 29 Variable manufacturing costs Direct material cost per CMCB Direct manufacturing labor cost per CMCB Variable manufacturing cost per batch for setups, materials handling, and quality control Fixed manufacturing cost Fixed manufacturing overhead costs that can be avoided if CMCBs 1,500 1,300 are not made 630,000 140,000 Fixed manufacturing overhead costs of plant depreciation, - Requirements 1. Calculate the total expected manufacturing cost per unit of making CMCBs in 2018. 2. Suppose the capacity currently used to make CMCBs will become idle if Solar purchases CMCBs from Michigan. On the basis of financial considerations alone, should Solar make CMCBs or buy them from Michigan? Show your calculations. 3. Now suppose that if Solar purchases CMCBs from Michigan, its best alternative use of the capacity currently used for CMCBs is to make and sell special circuit boards (CB3s) to the Evening Corporation. Solar estimates the following incremental revenues and costs from CB3s: Total expected incremental future revenues $2,300,000 Total expected incremental future costs $2,400,000 On the basis of financial considerations alone, should Solar make CMCBs or buy them from Michigan? Show your calculations