Question
The management of Shamrock Manufacturing Company is trying to decide whether to continue manufacturing a part or to buy it from an outside supplier.
The management of Shamrock Manufacturing Company is trying to decide whether to continue manufacturing a part or to buy it from an outside supplier. The part, called WISCO, 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, 2022: 1. The machining department produced 7,600 units of WISCO during the year. 2. Variable manufacturing costs applicable to the production of each WISCO unit were direct materials $4.90, direct labour $4.30, Indirect labour $0.43, and utilities $0.34. 3. Fixed manufacturing costs applicable to the production of WISCO were as follows: Cost Item Direct Allocated Total Depreciation $1,910 $900 $2.810 Property taxes 540 105 645 Insurance 920 560 1,480 $3,370 $1,565 $4.935
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