rea Troy Engines, Ltd., manufactures a variety of engines for use in heavy equipment. The company has always produced all of the necessary parts for its engines, including all of the carburetors. An outside supplier has offered to sell one type of carburetor to Troy Engines, Ltd., for a cost of $30 per unit. To evaluate this offer, Troy Engines, Ltd. has gathered the following information relating to its own cost of producing the carburetor internally Direct materials Direct labor Variable sinutacturing overhead Fixed manufacturing overhead, traceable Fixed an acturing overhead allocated Total cost 13,000 Per Units Unit Per Year 513 5 169,000 9 117.000 3 39,000 35,000 70,000 $ 34 542.000 "One third supervisory salaries: two-thirds depreciation of special equipment (no resale value Required: 1. Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the financial advantage disadvantage of buying 13.000 carburetors from the outside Supplier 2 should the outside supplier's offer be accepte 3. Suppose that if the carburetors were purchased, Troy Engines Ltd could use the feed capacity to launch a new product. The segment margin of the new product would be $150.000 per year Given this new assumtion what would be the financial indvantage dit vantage of buying 3000 carburetors from the outside supple? 4. Given the new assumonin requiremco 3, should the outside supersoner becept Complete this question by entering your answers in the tabs below. Seguire Required 2 Required Required Assuming the company has no temative use for the facilities that are now being used to produce the carburator what would be the financiar avantage disadvantage of buying 13,000 carturetors from the outside super Variable manufacturing overhead Fixed manufacturing overhead, traceable Fixed manufacturing overhead, allocated Total cost 3 39,000 31 39,999 6 78,000 $ 34 $ 442,800 *One-third supervisory salaries; two-thirds depreciation of special equipment (no resale value) Required: 1. Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 2. Should the outside supplier's offer be accepted? 3. Suppose that if the carburetors were purchased. Troy Engines, Ltd., could use the freed capacity to launch a new product. The segment margin of the new product would be $130,000 per year. Given this new assumption, what would be the financial advantage (disadvantages of buying 13,000 carburetors from the outside supplier 4. Given the new assumption in requirement 3, should the outside supplier's offer be accepted? Complete this question by entering your answers in the tabs below. Required t Required 2 Required 3 Required 4 Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? Honda PrevNext > on of special equipment (no resale value). Required: 1. Assuming the company has no alternative use for the facilities that are now being used to produce to the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 2. Should the outside supplier's offer be accepted? 3. Suppose that if the carburetors were purchased, Troy Engines, Ltd., could use the freed capacity to la segment margin of the new product would be $130,000 per year. Given this new assumption, what wou (disadvantage) of buying 13,000 carburetors from the outside supplier? 4. Given the new assumption in requirement 3, should the outside supplier's offer be accepted? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Should the outside supplier's offer be accepted? Yes No ation of special equipment (no resale value) Required: 1. Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 2. Should the outside supplier's offer be accepted? 3. Suppose that if the carburetors were purchased, Troy Engines, Ltd., could use the freed capacity to launch a new prod segment margin of the new product would be $130,000 per year. Given this new assumption, what would be the financia (disadvantage) of buying 13,000 carburetors from the outside supplier? 4. Given the new assumption in requirement 3, should the outside supplier's offer be accepted? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Suppose that if the carburetors were purchased, Troy Engines. Ltd, could use the freed capacity to launch a new product. The segment margin of the new product would be $130,000 per year. Given this new assumption, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? Required 2 Retired mpany has no alternative use for the facilities that are now tage (disadvantage) of buying 13,000 carburetors from the de supplier's offer be accepted? he carburetors were purchased, Troy Engines, Ltd., could u the new product would be $130,000 per year. Given this ne uying 13,000 carburetors from the outside supplier? ssumption in requirement 3, should the outside supplier's om question by entering your answers in the tabs below. quired 2 Required 3 Required 4 sumption in requirement 3, should the outside supplier's offer be Required 3
