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Question One (6 marks) Samsung manufacturing a variety of cell phones components. An outside supplier offered to sell screens to Samsung for $35 per unit
Question One (6 marks) Samsung manufacturing a variety of cell phones components. An outside supplier offered to sell screens to Samsung for $35 per unit To evaluate this offer, Samsung has gathered the following information relating to its own cost of producing the keyboards internally: Details $ Per Unit 14,000 unit per year Direct materials 11 154,000 Direct labor 98.000 Variable manufacturing overhead 5 70,000 Fixed manufacturing overhead - traceable 4. 56,000 Fixed manufacturing overhead - common but 12 168,000 allocated to screens line Total Cost 39 546,000 Required: Assuming that traceable overhead includes 65%-line supervisory salaries and 35% factory space rent for all Samsung's manufactured components, should the outside supplier's offer be accepted? Show all computations. (use total analysis approach) Details $ Per unit Make 14,000 unit Buy 14,000 unit Direct Material Direct labor Variable Manufacturing overhead Fixed Manufacturing overhead - Traceable Fixed Manufacturing overhead - common Outside purchase price Total
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