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Outdoor Fun manufactures snowboards. Its cost of making 1,900 bindings is as follows ?(Click the icon to view the costs.) Suppose an outside supplier will
Outdoor Fun manufactures snowboards. Its cost of making 1,900 bindings is as follows ?(Click the icon to view the costs.) Suppose an outside supplier will sell bindings to Outdoor Fun for $11 each. Outdoor Fun will pay $2.00 per unit to transport the bindings to its manufacturing plant, where it will add its own logo at a cost of 50.60 per binding. Read the requirements Requirement 1. Outdoor Fun's accountants predict that purchasing the bindings from the outside supplier will enable the company to avoid $2,500 of fixed overhead. Prepare an analysis to show whether Outdoor Fun should make or buy the bindings. (Enter a "O" for any zero balances. Round any per unit amounts to the nearest cent and your final answers to the nearest whole dollar. Use a minus sign or parentheses in the Difference column when the cost to make exceeds the cost to buy.) Incremental Analysis Outsourcing Decision Make Buy (Outsource) Bindings Bindings Difference Variable Costs Plus: Fixed Costs Total cost of 1,900 bindings Decision
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