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Lynn Hart is a managerial accountanta Pabex Corporation Polbec is under intense cost competition, and Herthas been asked to evaluate whether Polbec should continue to
Lynn Hart is a managerial accountanta Pabex Corporation Polbec is under intense cost competition, and Herthas been asked to evaluate whether Polbec should continue to manufacture part MT-RF or purchase it from Marley Company. Marley has submitted a bid to supply the 32,000 MT-RF units that Palbec will need for 2021 at a price of $15.80 each From plant records and interviews with Jone Porter, the plant manager, Hart gathered the following information regarding Paibec's costs to manufacture 29,000 units of MT-25 in 2020 Direct material Direct labor Plant space rental feed Equipment lease feed Other Overhead 5165.000 133,000 37,000 34,000 88,160 132,240 1619,800 Total Porter at her that MT-RFs not outsourced, all variable costs per unit, once rental costs and equipment losse costs will be the same in 2021 as in 2000, ENTRI purchased from Marley, plant space will not have to be rented and woment will not have to be led, but will cost $10.500 and 54,000, respectively, to terminate the two contacts, and . MTF is purchased from Marley, none of the fed overhead costs can be avoided. Hart recognizes that Poster is probably concerned that outsourcing MT will result in some of her close friends being told of She therefore performs her own independent analysis, and determines that: HT-RF is not outsourced direct material and direct labor costs per un are more likely to be higher in 2021 by and respectively .HT-R is purchased from Marley, the contract termination costs will actually be 58.500 for the space rental and $2,000 for the equipments, and .NAF s purchased from Marley, $10,000 of the fixed overhead costs can actually be saved. Hart estimated that 32,000 units of MTV will be needed in 2021. REQUIRED (Note: Round unit costs to two decimal places. Based on Hart's estimates, if MT-F is purchased from Marley in 2021, what will be the effect on Polbec's profits? (Note: If the buy costs are less than the make costs, enter the difference as a positive number, if the make contre than the buy costs, enter the difference as a negative number] Submit 0/6
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