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Noguchi Company menufactures cooling systems. Noguchi produces all the parts necessary for its product except for one electronic component, which is purchased fron two local

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Noguchi Company menufactures cooling systems. Noguchi produces all the parts necessary for its product except for one electronic component, which is purchased fron two local suppliers: Manzer Inc. and Buckner Company. Both suppliers are rellable and seldom deliver late; however, Manzer sells the component for s89 per unit, while Buckner sells the same component for 586 . Noguchi purchases 80% of its components from Buckner because of its lower price. The total annual demand is 4,000,000 components. To help assess the cost effect of the two components, the following dota were collected for supplier-related activities and suppliers: I. Activity Data 1. Calculate the cost per component for each supplier, taking into consideration the costs of the supplier-related activities and using the current prices and sales volume (Note: Round the intermediate calculations to the whole number for the following activity rates: "Reworking products" and "Warranty work". Round th unit cost to two decimal places.) Manzer inc. X per unit Bucloner Company per unit 2a. Suppose that Noguchi loses $3,840,000 in sales per year because it develops a poor reputation due to defective units attributable to falled components, Using warranty hours. assign the cost of lost sales to each supplier. Manzer buckner 2b. Ey how much would this change the cost of each supplier's component? Round your answers to the neareat cent. Manxer buckner 3. Eased on the analyus in Requirements 1 and 2 , discuss the importance of activity-based supplier costing for intemal decision making. As with product costing, accurate assignment of costs to the cost object is essential for well-grounded decision-making. 5 uppliers can couse a firm to perform costly activities such as inspection, rework, and warranty work, The componant wath the price is actually iess expensive because it causes less demand on internal costly activities. Thus, the company would likely the purchases of one suppller in favor of the other, It also might attempt to work with the one supplier which is causing significant dernands an

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