Learning Objective: 6-3 Make appropriate outsourcing decisions Stuart Company makes and sells lawn mowers for which it currently makes the engines. It has an opportunity to purchase the engines from a reliable manufacturer. The annual costs of making the engines are shown here. Cost of materials (14,500 Units $29) Labor (14,500 Units $12) Depreciation on manufacturing equipment Salary of supervisor of engine production Rental cost of equipment used to make engines Allocated portion of corporate-level facility-sustaining costs Total cost to make 14,500 engines "The equipment has a book value of $107,000 but its market value is zero. Required $ 420,500 174,000 40,000 76,000 22,000 78,000 $810,500 a. Determine the maximum price per unit that Stuart would be willing to pay for the engines. b. Determine the maximum price per unit that Stuart would be willing to pay for the engines, if production increased to 17,950 units