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please answer completely. Graded Part 1 of 2 points Points: 0 of 6 Save Best Systems manufactures an optical switch that it uses in its
please answer completely.
Graded Part 1 of 2 points Points: 0 of 6 Save Best Systems manufactures an optical switch that it uses in its final product. Another company has offered to sell Best Systems the switch for $18.50 per unit None of Best's fixed costs are avoidable. Click the icon to view the outsourcing decision) C Best Systems needs 82,000 optical switches. By outsourcing them, Best Systoms can use its ide facilities to manufacture another product that will contribute $223,000 to operating income. Read the requirements Make Idio Requirement 1. Identify the expected net costs that Best Systems will incur to acquire 82,000 switches under three alternative plans Outsource switches Facilities Make new Switch costs product Variable costs Direct materials Direct labor Variable manufacturing overhead Purchase cost Expected profit contribution from the other product (223.000) Total expected net cost of the optical switches tify th Make Outsource Difference optical switch optical switch (Make-Outsource) $ 7.00 1.50 7.00 1.50 Switc Variable costs: Direct materials Direct labor Variable overhead Purchase price from outsider Differential cost per unit 8.00 8.00 $ 18.50 (18.50) $ 16.50 $ 18.50 $ (2.00) facturit Requirements Requirements - X 1. Identify the expected net costs that Best Systems will incur to acquire 82,000 switches under three alternative plans: make the switches, buy the switches and leave facilities idle, buy the switches and use the idle facilities to make another product. 2. Which plan makes the best use of Best System's facilities? Support your answer. Print Done Step by Step Solution
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