PennTech Corporation has been producing two precision bearings, components T79 and B81, for use in production in its central Pennsylvania plant. Data regarding these two components follow.

	T79			B81
Machine hours required per unit		2.5			3.0
Standard cost per unit:
Direct material	$	6.75		$	11.25
Direct labor		12.00			13.50
Manufacturing overhead
Variable*		6.00			6.75
Fixed		11.25			13.50
Total	$	36.00		$	45.00

*Variable manufacturing overhead is applied on the basis of direct-labor hours.

Fixed manufacturing overhead is applied on the basis of machine hours.

PennTechs annual requirement for these components is 8,000 units of T79 and 11,000 units of B81. Recently, management decided to devote additional machine time to other product lines, leaving only 41,000 machine hours per year for producing the bearings. An outside company has offered to sell PennTech its annual supply of bearings at prices of $33.75 for T79 and $40.50 for B81. Management wants to schedule the otherwise idle 41,000 machine hours to produce bearings so that the firm can minimize costs (maximize net benefits).

6.

value: 12.50 points

Required information

Required:

1.	Compute the net benefit (loss) per machine hour that would result if PennTech Corporation accepts the suppliers offer of $40.50 per unit for component B81.
	Net benefit or loss? per machine hour if component b81is purchased is what?