Requirements 1-3

Fiber Systems manufactures an optical switch that it uses in its final product Fiber Systems incurred the following manufacturing costs when it produced 68.000 units last year (Click the icon to view the manufacturing costs) Fiber Systems does not yet know how many switches it will need this year, however, another company has offered to sell Fiber Systems the switch for $15 50 per unit. If Fiber Systems buys the switch from the outside supplier the manufacturing facilities that will be idle cannot be used for any other purpose, yet none of the fixed costs are avoidable Read the requirements Requirement 1. Given the same cost structure, should Fiber Systems make or buy the switch? Show your analysis Complete an incremental analysis to show whether Fiber Systems should make or buy the switch (Enter a "0" for any zero amounts. Round amounts to the nearest centUse a minus sign or parentheses when the cost to buy exceeds the cost to make Fiber Systems Incremental Analysis for Outsourcing Decision Make Buy Unit Difference Variable cost per unit Choose from any list of enter any number in the input filios and then click Check Answer Fiber Systems manufactures an optical switch that it uses in its final product. Fiber Systems incurred the following manufacturing costs when it produced 68.000 unas last year (Click the icon to view the manufacturing costs) Fiber Systems does not yet know how many switches it will need this year, however, another company has offered to sell Fiber Systems the switch for $15.50 per unit If Fiber Systems buys the switch from the outside supplier, the manufacturing facilities that will be idle cannot be used for any other purpose, yet none of the fixed costs are avoidable Read the requirements Complete an incremental analysis to show whether Fiber Systems should make or buy the switch (Enter a "0" for any zero amounts. Round amounts to the nearest cent. Use a minus sign or parentheses when the cost to buy exceeds the cost to make ) Fiber Systems Incremental Analysis for Outsourcing Decision Make Buy Unit Unit Difference Variable cost per unit M Total variable cost per unit 2 Choose from any list or enter any number in the input fields and then click Check Answer Check Answer nas Clear All FiberSystems manufactures an optical switch that it uses in its ind pluu. offere following manufacturing costs when it produced 68,000 units last year suppl (Click the icon to view the manufacturing costs.) fixed Read the requirements. Complete an incremental analysis to show whether Fiber Systems sho'd make or buy the switch. (Enter a "0" for any to buy exceeds the cost to make.) Fiber Systems Incremental Analysis for Outsourcing Decision Make Buy Unit Unit Difference Variable cost per unit. Direct labor Direct materials Fixed overhead Purchase price from outsider Sales price Variable overhead nber in the input fields and then click Check Answer remaining learA tit uses in its final product. FiberSystems incurred the 8,000 units last year is ) Fiber Systems does not yet know how many switches it will offered to sell FiberSystems the switch for $15.50 per unit i supplier, the manufacturing facilities that will be idle cannot fixed costs are avoidable. Data Table hould Fiber Systems er FiberSystems shou the nearest cent U ems 1 Direct materials $ 612.000 Outsourcing Decisid 2 Direct labor 102 000 Buy 3 Variable MOH 136.000 4 Fixed MOH 408.000 5 Total manufacturing cost for 68,000 units $ 1.258.000 Punt Done input fiels and then click check Answer lear uses in its final product. FiberSystems incurred the 100 units last year: FiberSystems does not yet know how many switches it will nee offered to sell Fiber Systems the switch for $15 50 per unit. If F supplie he manufacturing facilities that will be idle cannot be fix costs are avoidable. Requirements uld FiberSy arest cent Use Fiber Systen ms tsourcing 1. Given the same cost structure, should FiberSystems make or buy the switch? Show your analysis 2. Now, assume that Fiber Systems can avoid $104,000 of fixed costs a year by outsourcing production. In addition, because sales are increasing, Fiber Systems needs 73,000 switches a year rather than 68.000 switches. What should the company do now? 3. Given the last scenario what is the most Fiber Systems would be willing to pay to outsource the switches? Print Done Input fields and then click Check Answer Clear All