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Silver Start Limited (SSL) manufactures 25,000 units of Product each year to use on its own production line. The cost per un for Productie in
Silver Start Limited (SSL) manufactures 25,000 units of Product each year to use on its own production line. The cost per un for Productie in follow Direct Materials Direct Labour Variable manufacturing overhead Fluced manufacturing overhead Total cost per unit R. 720 1.050 480 1,500 3,750 An outside supplier has offered to sell 25,000 units of Product M each year to SSL for Rs.3,525 per unit. If SSL accept this offer, the facilities now being used to manufacture Product 'M could be rented to another company at an annual rent of Rs. 22,500,000. However, SSL has determined than Rs. 900 of the fored manufacturing overhead applied to Product 'M' would continue even If Product Me were purchased from the outside supplier. The Net rupee benefit or loss of accepting the outside supplier's offer is
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