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The management of Bramble Manufacturing Company is trying to decide whether to continse manufacturing a part or to buy it from an outside suppler The

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The management of Bramble Manufacturing Company is trying to decide whether to continse manufacturing a part or to buy it from an outside suppler The part, called CiScO, is a component of the company's finished product The following information was collected from the accounting records and production data for the year ending December 31, 201 1. 8,100 units of CISCO were produced in the Machining Department 2. Variable manufacturing costs applicable to the preduction of each CISCO unit were: direct materials $5.36, direct laber $4.52, indirect labor $0.42, utilities $o.43 3. Fixed manufacturing costs applicable to the production of CISCO were Cost Item Direct Allocated Depreciation $2,000 $30 Property taxes 470 440 Insurance 960 3,430 $2,030 All variable manufacturing and direct fixed costs will be elminated if CISCO is purchased. Allocated couts will have to be absorbed by other Allocated costs will have to be absorbed by other production departments . The lowest quotation for 8,100 CISCO units from a supplier is $87,297 5 2f CISCO units are purchased, freight and spection costs would be $0.36 per unt and recening costs teiing200 per yes would be tained by the Ha Nn bepannee Prepare an incremental analysuis for CISCO. mount decreases net income thea enter the amount unsing either a negative sign preceing te eg. 435 or parentheses e-g- (45).,) Increase Make CISco By CISCO(Dec Direct material Direct labor Indirect labor Utilities Depreciation Property taxes Purchase price Freight and inspection Receiving costs Total annual cost Based on your analysis, what decision should management make? The company should Would the decision be different if Bramble Company has the opportunity to produce $3,000 of net income with the facilities currently being used to manufacture CISCO Click if you would like to Show Work for this questiont Open Shon.Work

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