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Make or buy A company manufactures various-sized plastic bottles for its medicinal product. The manufacturing cost for small bottles is $53 per unit (100 bottles),
Make or buy A company manufactures various-sized plastic bottles for its medicinal product. The manufacturing cost for small bottles is $53 per unit (100 bottles), including fixed costs of $11 per unit. A proposal is offered to purchase small bottles from an outside source for $33 per unit, plus $3 per unit for freight. Prepare a differential analysis dated January 25 to determine whether the company should make (Alternative 1) or buy (Alternative 2) the bottles, assuming fixed costs are unaffected by the decision. If an amount is zero, enter "0". Enter unit costs as positive values. Use a minus sign to indicate negative Differential Effects. Unit costs: Purchase price Differential Analysis Make Bottles (Alt. 1) or Buy Bottles (Alt. 2) January 25 Make Bottles (Alternative 1) Buy Bottles (Alternative 2) Differential Effects (Alternative 2) Freight Variable costs Fixed factory overhead Total unit costs Determine whether the company should make (Alternative 1) or buy (Alternative 2) the bottles
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