Munoz Chemical Company makes a variety of cosmetic products, one of which is a skin cream designed to reduce the signs of aging Munoz produces a relatively small amount (19,000 units) of the cream and is considering the purchase of the product from an outside supplier for $510 each. If Munoz purchases from the outside supplier, it would continue to sell and distribute the cream under its own brand name Munoz's accountant constructed the following profitability analysis Revenue (19,000 units * $12.00) Unit-level materials costs (19,800 units * $1.29) Unit-level labor costs (19,000 units * $0.70) Unit-level overhead costs (19.000 $0.20) Unit-level selling expenses (19,000 $0.40) Contribution margin Skin cream production supervisor's salary Allocated portion of facility-level costs Product-level advertising cost Contribution to company wide income $228,000 (22,see) (13,300) (3,800) (7.600) 180,500 (66,000) (13,200) (46,000) 5 55,300 Required 6. Identify the cost items relevant to the make-or-outsource decision b. What is the avoidable cost per unit if the outsourcing decision is taken? Should Munoz continue to make the product or buy it from the supplier? c. Suppose that Munoz is able to increase sales by 6,000 units sates will increase to 25,000 units) Calculate the total avoidable costs At this level of production, should Munoz make or buy the cream? Required a. Identify the cost items relevant to the make-or-outsource decision b. What is the avoidable cost per unit if the outsourcing decision is taken? Should Munoz continue to make the product or buy it from the supplier c. Suppose that Munoz is able to increase sales by 6,000 units (sales will increase to 25,000 units). Colculate the total avoidable costs At this level of production, should Munoz make or buy the cream? Complete this question by entering your answers in the tabs below. Required A Required B Required Identify the cost items relevant to the make or outsource decision Tot voidable costs Required A Required B Required What is the avoidable cost per unit if the outsourcing decision is taken? Should Munoz continue to make the product or buy it from the supplier? (Round your answer to 2 decimal places.) Total avoidable costs Should Munoz continue to make the product or buy it from the supplier? per unit