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The Old and Senile Professor Mullen, Inc. currently manufactures a wicket as its main product. The costs per unit are as follows: Saran Company has
The Old and Senile Professor Mullen, Inc. currently manufactures a wicket as its main product. The costs per unit are as follows: Saran Company has contacted The Old and Senile Professor Mullen with an offer to sell it 5,000 of the wickets for 554 catch. To make the wickets in house, the variable costs are $48 per unit (DM and DL = $33 and VOH = $15). Fixed costs are $24 per unit; however, $15 per unit in unavoidable. Should The Old and Senile Professor Mullen make or buy the wickets? Buy; savings = $45,000 Buy; savings = $15,000 Make; savings = $30,000 Make; savings = $15,000 Lao Shu Company is unsure of whether to sell its product assembled or unassembled. The unit cost of the unassembled product is $30 and Lao Shu would sell it currently for $65. The cost to assemble the product is estimated at $21 per unit and the company believes the market would support a new price of $85 on the assembled unit. What decision should Lao Shu make about whether to sell or process further? Sell before assembly, the company will be better off by $1 per unit. Sell before assembly, the company will be better off by $20 per unit. Process further, the company will be better off by $29 per unit. Process further, the company will be better off by $14 per unit. Xian Mian in starting business and is unsure of whether to sell its product assembled or unassembled. The unit cost of the unassembled product is $80 and Xiao Miao would sell it currently for $180. The cost to assemble the product is estimated at $36 per unit and Xiao believers the market would support a new price of $232 on the assembled unit. What is the correct decision using the sell or process further decision rule? Sell before assembly, the company will be better off by $36 per unit. Sell before assembly, the company will be better off by $52 per unit. Process further, the company will be better off by $52 per unit. Process further, the company will be better off by $16 per unit
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