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Make or Buy JayCo Ltd. manufactures tennis racquets. In addition to the metals for the frame, each racquet requires 2 yards of nylon blend string,
Make or Buy JayCo Ltd. manufactures tennis racquets. In addition to the metals for the frame, each racquet requires 2 yards of nylon blend string, which JayCo Ltd. also produces. Recently, Strung Out Strings has approached JayCo Ltd. to sell string for $20 per pack. JayCo has provided you the following information about their costs for producing 67,000 packs of string from last year: Units (packs) Direct materials Direct labor Variable MOH Per year 67,000 321,600 452,250 150,750 350,000 1,274,600 Fixed MOH Total Cost $ Currently, Jay Co Ltd. has no other plans for the facilities that produce the string. Should Jay Co Ltd. continue to make the string internally, or accept the offer from Strung Out String? (Show calculations and explain.) (Calculations) (You may not need the whole spa Should JayCo Ltd. continue to make the string or buy it? I (
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