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show calculations and how uou got the answer Current-Control, Inc., manufactures a varlety of electrical switches. The company is currently manufacturing all of its own
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Current-Control, Inc., manufactures a varlety of electrical switches. The company is currently manufacturing all of its own component parts. An outside supplier has offered to sell a switch to Current- Control for $32 per unit. To evaluate this offer, Current-Control, Inc., has gathered the following information relating to its own cost of producing the switch internally: 1. Assuming that the company has no altemative use for the facillites now being used to produce the switch, should the outside supplier's offer be accepted? Show all computations. 2. Suppose that if the switches were purchased, Current-Control, Inc., could use the freed capacity to launch a new product. The segment margin of the new product would be $78,000 per year. Should Current-Control, Inc, accept the offer to buy the switches from the outside supplier for $32 Step by Step Solution
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