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Q2)- The Karnak Company produces several types of goods, and the intervention of the commodity or material XY in the manufacture of most of its
Q2)- The Karnak Company produces several types of goods, and the intervention of the commodity or material "XY" in the manufacture of most of its products, which are currently purchased at $36 per unit, and estimated the amount required for the duration of 20000 units of material, and the Director of production proposal to manufacture "XY" As the possibilities are available, and the costs are estimated as follows: Direct materials$ 4, direct labor $16, F.O.H variable$ 8, fixed $ 10 if the commodity is not produced "XY", the means of production will not be used in another field 60% of fixed industrial production will continue regardless of the decision taken. Required: Do you recommend manufacturing or buying material
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