in my opinion, we ought to stop making our own drums and accept that outside supplier's offer" said Wim Niewindt, managing director of Antilles Refining, NV. of Aruba "At a price of $21 per drum, we would be paying $4.85 less than it costs us to manufacture the drums in our own plant Since we use 50,000 drums a year, that would be an annual cost savings of $242,500." Antilles Refining's current cost to manufacture one drum is given below (based on 50,000 drums per year) $11.20 7.00 1.75 biect ateriais Durece tabor Variable overhead Med overhead ($3.00 general company overhead, 31. depreciation, and 3103 VELO) Total cost per des 5.90 $25.5 A decision about whether to make or buy the drums is especially important at the time because the equipment being used to make the drums is completely worn out and must be replaced the choices facing the company are: Alternative Rem new equipment and continue to make the drums. The equipment would be rented for $157,500 per year Alternative 2. Purchase the drums from an outside supplier at $21 pe drum The new equipment would be more efficient than the equipment that Antiles Refining has been using and, according to the manufacturer would reduce direct labor and variable overlad costs by 20% The okt equipment has no resale value Supervision cost (552 500 per yeon and direct materials cost per drum would not be affected by the new equipment. The new equipment's capacity would be 105.000 drums per year The company's total general company overhead would be unaffected by the decision Required: 1 Assuming that 50.000 drums are needed each year, what is the financial advantage disadvantacje) or buying the drums from an outside suplier 2. Asuming that 75.000 drums are needed each year, what is the financial advantage disadvantage of buying the drums from an outside supple 3. Assuming that 105,000 drums are needed each year, who is the financial advantage disadvantage) or buying the drums from an outside supplier For all requirements, enter any disadvantages os e negative value. Do not round Intermediate calculations.) Finance Advantage une Ndos Disadvantage of Hiving Drums 00.000 de