Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Sardi Inc. is considering whether to continue to make a component or to buy it from an outside supplier. The company uses 14,000 of the

image text in transcribed
Sardi Inc. is considering whether to continue to make a component or to buy it from an outside supplier. The company uses 14,000 of the components each year The unit product cost of the component according to the company's cost accounting system is given as follows Direct materials Direct labor Variable manufacturing overhead Fixed munufacturing overhead Unit prodct cost 523,e Assume that outude supplier In addnon making the component unes 3 minutes on the machine that is the component were bought, time would be treed up for use on another product that requires6 menutes on thes machine and that has contibution margin of $6.20 per unt When deciding whether to make or buy the component what cost of making the component should be compared to the price of buying the component? (Pound your intermediese celculetions to 2 decimal places) 84vanatie cost Otthe trd mandactrng overteed, 35%BAVid ble the component were bought from the company's current consant the 3 2 13 0 LENO

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Alpine Cupcakes Audit Case With Data Analytics

Authors: Carol Callaway Dee, Mary P.Mindak

2nd Edition

1618533231, 978-1618533234

More Books

Students also viewed these Accounting questions