The Partyka Company produces chairs. This year's expected production is 30,000 units. Currently, Partyka makes the upholstery for the chairs in its factory. Partyka's management accountant reports the following costs for the upholstery for the 30,000 chairs: Partyka has received an offer from an outside vendor to supply the upholstery for the chairs Partyka requires at $10.00 per chair. (Click to view the information.) Read the requirements. Requirement 1. Assume that if the outside vendor supplies the upholstery, the facility where the upholstery is currently made will remain idle. On the basis of financial considerations alone, should Partyka accept the outside vendor's offer at the anticipated volume of 30,000 chairs? Show your calculations. (If an input field is not used in the table, leave the input field Relevant Costs Make Buy * Requirements Total relevant costs Data Table Direct materials $ Cost per Unit 5.35 $ Cost for 30,000 Units 160,500 Variable direct manufacturing labor 2.10 63,000 Variable manufacturing overhead 1.50 45,000 Variable inspection, setup, materials handling 180,000 Allocated fixed costs of plant administration, taxes, and insurance 30,000 $ 478,500 Total costs 1. Assume that if the outside vendor supplies the upholstery, the facility where the upholstery is currently made will remain idle. On the basis of financial considerations alone, should Partyka accept the outside vendor's offer at the anticipated volume of 30,000 chairs? Show your calculations. 2. For this question, assume that if the upholstery is purchased outside, the available unused facilities will be used to make pillows to match the chairs. Each pillow sells for $35 with a variable cost of $29. No other costs would change and the company expects to sell 10,000 pillows. On the basis of financial considerations alone, should Partyka make or buy the upholstery for their chairs, assuming that 30,000 chairs are produced (and sold)? Show your calculations. 3. The sales manager at Partyka is concemed that the estimate of 30,000 chairs may be high and believes that only 27,000 chairs will be sold. Production will be cut back, freeing up work space. This space can be use to make 10,000 pillows whether Partyka buys the upholstery or makes it in-house. On the basis of financial considerations alone, should Partyka purchase the upholstery from the outside vendor? Show your calculations. Print Done ?