Penbirch Electronics manufactures most of the components that make up its products.A company has approached Penbirch offering to sell them A-12 Motherboards for $52 each, a component that they currently manufacture in-house.Cost information for an A-12 is given below:

Cost per Unit Direct materials $17.50 Direct labour 12.75 Manufacturing overhead 28.75 Total cost per unit 59.00

The manufacturing overhead is made up of $14.50 per unit in variable costs and $14.25 in fixed cost allocations that will be assigned to other products if Penbirch accepts the offer.

Should Penbirch continue to manufacture the A-12 Motherboards or should they purchase them from the outside supplier?

Penbirch Electronics manufactures most of the components that make up its products. A company has approached Penbirch offering to sell them A712 Motherboards for $52 each, a component that they currently manufacture inhouse. Cost information for an A12 is given below: Cost per Unit Direct materials 3 17.50 Direct labour 12.75 Manufacturing overhead 28.75 Total cost per unit 59.00 The manufacturing overhead is made up of $14.50 per unit in variable costs and $14.25 in xed cost allocations that will be assigned to other products if Penbirch accepts the offer. Should Penbirch continue to manufacture the A712 Motherboards or should they purchase them from the outside supplier