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Question Content Area Lockrite Security Company manufacturers home alarms. Currently, it is manufacturing one of its components at a total cost of $41, which includes
Question Content Area Lockrite Security Company manufacturers home alarms. Currently, it is manufacturing one of its components at a total cost of $41, which includes fixed costs of $15 per unit. An outside provider of this component has offered to sell Lockrite the component for $32. Provide a differential analysis of the outside purchase proposal. If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign.
Differential Analysis | ||||||
Make Component (Alternative 1) or Buy Component (Alternative 2) | ||||||
Make Component (Alternative 1) | Buy Component (Alternative 2) | Differential Effects (Alternative 2) | ||||
Unit costs: | ||||||
Purchase price | ||||||
Variable costs | ||||||
Fixed costs | ||||||
Total unit costs |
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