Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

TE MC Qu. 13-77 (Algo) Sardi Incorporated is considering whether to continue... 6 Sardi Incorporated is considering whether to continue to make a component or

image text in transcribed
TE MC Qu. 13-77 (Algo) Sardi Incorporated is considering whether to continue... 6 Sardi Incorporated is considering whether to continue to make a component or to buy it from an outside supplier. The company uses 13.200 of the components each year. The unit product cost of the component according to the company's cost accounting system is given as follows: 629 Direct materials $ 9.00 Direct labor 6.00 Variable manutacturing over head 1.80 Tixed manufacturing overhead 3.30 Unit product cont $20.60 Assume that direct labor in a variable cost of the food manufacturing overhead, 26% is avoidable if the component were bought from the outside supplier in addition, making the componentes 3 minutes on the machine that in the company current constraint if the component were bought, time would be freed up for use on another product that requires 6 minutos on this machine and that has a contribution margin of $5.40 per unit 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? (Round your intermediate calculations to 2 decimal places)

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

Step: 3

blur-text-image

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

BondsA Concise Guide For Investors

Authors: M. Choudhry

2nd Edition

0230006493, 9780230006492

More Books

Students also viewed these Accounting questions