Purple Cameras, Ltd. manufactures a variety of cameras for use by professional photographers. The company has always produced all of the necessary parts for its cameras, including all of the lenses. An outside supplier has offered to sell one type of lens to Purple Cameras, Ltd. for a cost of $35 per unit. Product Manager Marcus McGwire is very excited because it costs Purple Camera $42 to manufacture the lenses. Controller Judy Ginsberg is not so sure. To evaluate this offer, Purple Cameras, Ltd. has gathered the following information relating to its own cost of producing the carburetor internally:

	Per Lens	Costs at 15,000 Lenses per Year
Direct materials	$14	$210,000
Direct labor	$10	$150,000
Variable manufacturing overhead	$3	$45,000
Fixed manufacturing overhead, traceable *	$6	$90,000
Fixed manufacturing overhead, allocated	$9	$135,000
Total cost	$42	$630,000
* One-third supervisory salaries; two-thirds depreciation of special equipment (no resale value)

1. Assuming that the company has no alternative use for the facilities that are now being used to produce the carburetors, compute the impact of making and buying the parts.
2. Compute the relevant costs.
3. What quantitative and qualitative facts should be considered? Be sure to consider ALL of the Stakeholders!