please answer fast , I don't have time
Southampion Corporation manufactures part M40 and use it in one of its products. The company reports the following costs of producing the 5.000 units of the part: An ouside suppliet has offered to make the part and selt it to the company for $50.00 each. If this offer is accepied, two- thind of the eiectricity of the factory can be avoided. The spocial tool used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represeats fixed costs of the entire conpany. If the outside supplier's offer was accepted, 51,000 of these allocated general overhead costs would be unavoidable. In addition, the space used to protuce part M40 could be used to make note of one of the company's other products, generating an additional segment margin of $15,000 per year for that product. Requixd: a. What is the financial advantage (disadvantage) of accepting the outside supplier's offer? Would Southampton Corporation be financially better otf to continue making part M40 or to buy it from an outside supptien? And why? (2.25 Marks) b. Assume that Southampton Corporation requires additional equipment that costs 54,000 to make part M40. As a result, the direet labor cost will decrease by $4.00 per unit. What is the financial advintage (disadvantage) of accepting the outside supplier's otter? (2.25 Marks) Required: a. What is the financial advantage (disadvantage) of accepting the outside supplier's offer? Would Southampton Corponation be financially better off to continue making part M40 or to buy it from an outside supplier? And why? (2.25 Marks) b. Assume that Southampton Corporation requires additional equipment that costs $4,000 to make part M40. As a result, the direct labor cost will decrease by $4.00 per unit. What is the financial advantage (disadvantage) of accepting the outside supplier's offer? (2.25 Marks) c. Based on your calculation in requirements (a) and (b), which case would be better off for Southampton Corporation? (0.25 Marks) d. If Southampton Corporation decided to make part M40, what would be the advantages of making the part? ( 0.25 Marks) Southampion Corporation manufactures part M40 and use it in one of its products. The company reports the following costs of producing the 5.000 units of the part: An ouside suppliet has offered to make the part and selt it to the company for $50.00 each. If this offer is accepied, two- thind of the eiectricity of the factory can be avoided. The spocial tool used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represeats fixed costs of the entire conpany. If the outside supplier's offer was accepted, 51,000 of these allocated general overhead costs would be unavoidable. In addition, the space used to protuce part M40 could be used to make note of one of the company's other products, generating an additional segment margin of $15,000 per year for that product. Requixd: a. What is the financial advantage (disadvantage) of accepting the outside supplier's offer? Would Southampton Corporation be financially better otf to continue making part M40 or to buy it from an outside supptien? And why? (2.25 Marks) b. Assume that Southampton Corporation requires additional equipment that costs 54,000 to make part M40. As a result, the direet labor cost will decrease by $4.00 per unit. What is the financial advintage (disadvantage) of accepting the outside supplier's otter? (2.25 Marks) Required: a. What is the financial advantage (disadvantage) of accepting the outside supplier's offer? Would Southampton Corponation be financially better off to continue making part M40 or to buy it from an outside supplier? And why? (2.25 Marks) b. Assume that Southampton Corporation requires additional equipment that costs $4,000 to make part M40. As a result, the direct labor cost will decrease by $4.00 per unit. What is the financial advantage (disadvantage) of accepting the outside supplier's offer? (2.25 Marks) c. Based on your calculation in requirements (a) and (b), which case would be better off for Southampton Corporation? (0.25 Marks) d. If Southampton Corporation decided to make part M40, what would be the advantages of making the part? ( 0.25 Marks)
