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InteliSystems manufactures an optical switch that it uses in its final product. Intel Systems incurred the following manufacturing costs when it produced 70,000 units last
InteliSystems manufactures an optical switch that it uses in its final product. Intel Systems incurred the following manufacturing costs when it produced 70,000 units last year. Click the icon to view the manufacturing costs.) InteliSystems does not yet know how many switches it will need this year, however, another company has offered to sell IntellSystems the switch for $8.50 per unit. If IntellSystems buys the switch from the outside supplier, the manufacturing facilities that will be idle cannot be used for any other purpose, yet none of the fixed costs are avoidable Read the requirements Requirement 1. Given the same con structure, should Intel Systems make or buy the switch? Show your analysis. Complete an incremental analysis to show whether inte Systems should make or buy the switch (Enter a "O for any zero amounts Round amounts to the nearest centre a minus sign or parentheses when the cost to buy moved the cost to make -X i Data Table B $ 560,000 uld 1 Direct materials 105,000 2 Direct labor Int ost 70,000 3 Variable MOH 455,000 ems 4 Fixed MOH $ 1,190,000 uts 5 Total manufacturing cost for 70,000 units Le Print Done heing i Requirements 1. Given the same cost structure, should InteliSystems make or buy the switch? Show your analysis. 2. Now, assume that InteliSystems can avoid $105,000 of fixed costs a year by outsourcing production. In addition, because sales are increasing, InteliSystems needs 75,000 switches a year rather than 70,000 switches. What should the company do now? 3. Given the last scenario, what is the most inteliSystems would be willing to pay to outsource the switches? Print Done Variable cost per unit: Total variable cost per unit Choose from any list or enter any number in the input fields and then click Check
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