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Snowy Mountain manufactures snowboards. Its cost of making 19,000 bindings is as follows: ?(Cick the icon to view the costs.) Suppose an outside suppier will
Snowy Mountain manufactures snowboards. Its cost of making 19,000 bindings is as follows: ?(Cick the icon to view the costs.) Suppose an outside suppier will sell bindings to Snowy Mountain for $15 each. Snowy Mountain will pay S2.00 per unit to transport the bindings to its manufacturing plant, where it will add its own logo at a cost of S0.50 per binding. Read the requirements. Requirement 1. Snowy Mountain's accountants predict that purchasing the bindings from the outside supplier will enable the company to avoid $1,900 of fixed overhead. Prepare an analysis to show whether the company should make or buy the bindings. (Enter a" for any zero balances. Round any per unit amounts to the nearest cent and your final answers to the nearest whole dollar. Use a minus sign or parentheses in the Difference column when the cost to make exceeds the cost to buy.) Make Buy (Outsource) Bindings Incremental Analysis Data Table Bindings Difference Variable Costs Plus: Fixed Costs Total cost of 19,000 bindings S 22,000 81,000 44,000 81,000 S 228,000 S12.00 Direct labor ariable manufacturing overhead Fixed manufacturing overhead Total manufacturing costs Cost per pair ($228,000/19,000) Decision: Requirement 2. The facilities freed by purchasing bindings from the outside supplier can be used to man produced the bindings. Show which alternative makes the best use of Snowy Mountain'ss facilities: (a) balances. Round any per unit amounts to the nearest cent and your final answers to the nearest whole doll the same as if Snowy Mountain had another product. (Enter a "O" for any zero
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