Question:

Requirements:

X Perience manufactures snowboards. Its cost of making 2,100 bindings is as follows: (Click the icon to view the costs.) Suppose Livingston will sell bindings to X Perience for $14 each. X add its own logo at a cost of $o.60 per binding. Perience would pay $1 per unit to transport the bindings to its manufacturing plant, where it would Read the requirements, Requirement 1. X - Perience's accountants predict that purchasing the bindings from Livingston will enable the company to avoid $1,900 of fixed overhead. Prepare an analysis to show whether X - Perience should make or buy the bindings. (Only enter the net relevant costs. For the Difference column, use a minus sign or parentheses only when the cost of outsourcing exceeds the cost of making the bindings in-house.) Make Outsource Difference Binding costs Bindings Bindings (Make-Outsource) Variable costs: Direct materials Direct labor Variable overhead Fixed costs Purchase price from Livingston Transportation Logo Total differential cost of 2,100 bindings - X ic i Requirements Its 1. X- Perience's accountants predict that purchasing the bindings from Livingston will enable the company to avoid $1,900 of fixed overhead. Prepare an analysis to show whether X - Perience should make or buy the bindings. W 2. The facilities freed by purchasing bindings from Livingston can be used to manufacture another product that will contribute $3,500 to profit. Total fixed costs will be the same as if X - Perience had produced the bindings. Show which alternative makes the best use of X - Perience's facilities: (a) make bindings, (b) buy bindings and leave facilities idle, or (c) buy bindings and make another product. nt o Is Print Done - X Data Table Direct materials 17,520 Direct labor 3,200 Variable overhead 2,040 6,900 Fixed overhead $ 29,660 Total manufacturing costs for 2,100 bindings then click CH Print Done Check Answe Clear AlL