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please answer both a and b with all of the work Philco Technologies manufactures 10,000 wireless printers per year. One of the parts it makes
please answer both a and b with all of the work
Philco Technologies manufactures 10,000 wireless printers per year. One of the parts it makes in its own factory are the Bluetooth devices that allow the printers to be wireless. The accounting department has reported the following costs of producing these Bluetooth devices in-house: A large Brazilian supplier has offered to sell Philco the 10,000 bluetooth devices it needs each year for $35.00 each. The specialized equipment has no re-sale or salvage value and has no other use in the Philco factory. a) Should Philco make or buy the Bluetooth devices? Show all calculations. ( 8 marks) b) The factory manager believes the space now being used to produce Bluetooth devices could be used to produce ink cartridges which would generate a Contribution Margin of $100,000 per year and Traceable fixed Costs of $40,000 per year? In this case should Philco make or buy the Bluetooth devices? Show all calculations. (2 marks) Step by Step Solution
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