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QUESTION 2 Computer Technology Company currently manufactures the electronic components for its printers and the plastic cases in which the devices are enclosed. Amirah, the

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QUESTION 2 Computer Technology Company currently manufactures the electronic components for its printers and the plastic cases in which the devices are enclosed. Amirah, the production manager, recently received a proposal from Mega Plastics Company to manufacture the plastic cases for Computer Technology's printers. If the cases are purchased outside, Computer Technology will be able to close down its Printer Case Department. To help decide whether to accept the offer from Mega Plastics, Amirah asked the Computer Technology's controller to prepare an analysis of the costs that would be saved if the Printer Case Department were closed. The controller gave to Amirah the following list of items for annual cost savings: Building rental (The Printer Case Department occupies one-sixth of the RM29,600 factory building, which computer Technology rents for RM177,600 per year. Salary of the Printer Case Department supervisor RM48,000 The followings are additional information that Amirah learned from her discussion with the controller: Computer Technology was currently renting space in a warehouse for RM36,000 per annum If the Printer Case Department were discontinued, the entire storage operation could be moved into the factory building and occupy the space vacated by the closed department Amirah also learned the supervisor of the Printer Case Department would be retained even if the department were closed. The supervisor would be assigned the job of managing the assembly department, whose supervisor recently gave notice of his retirement. All of the Computer Technology's department supervisors earn the same salary, Required: You have been hired as a consultant by Amirah to advise her in her decision. Write an email to Amirah commenting on the costs of space and supervisory salaries included in the controller's cost analysis. Explain in your email about the costs of the space occupied by the Printer Case Department and the supervisor's salary. Explain to Amirah the type of the costs

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