The Summer Corporation manufactures cellular modernis. It manufactures its own cellular modem circuit boards (CMCB), an important part of the cellular modern. The company reports the following cost information about the costs of making CMCBs in 2012 and the expected posts in 2013: (Click the icon to view the costs.) Summer manufactured 15,200 CMCBs in 2012 in 80 batches of 190 each. In 2013, Summer anticipates needing 17,000 CMCBs. The CMCBs would be produced in 100 batches of 170 each. The Manson Corporation has approached Summer about supplying CMCBs to Summer in 2013 at $280 per CMCB on whatever delivery schedule Summer wants. Read the requirements, Data Table Requirement 1. Calculate the total expected manufacturing cost per unit of making CMCBs in 2013. Total Manufacturing Manufacturing Current Costs Expected Costs Costs of CMCB Cost per Unit in 2012 in 2013 Direct materials Variable manufacturing costs Direct manufacturing labor Direct material cost per CMCB S 185 S 165 Variable batch manufacturing costs Direct manufacturing labor cost per CMCB 60 44 Fixed manufacturing costs Variable manufacturing cost per batch for setups, Avoidable fixed manufacturing costs materials handling, and quality control 1,750 1,700 Unavoidable fixed manufacturing costs Fixed manufacturing cost Fixed manufacturing overhead costs that can be Total manufacturing costs re not made 553,580 595.000 X i Requirements overhead costs of plant nce, and administration that Even if CMCBs are not made 966,420 1,020,000 1. Calculate the total expected manufacturing cost per unit of making CMCBs in 2013. 2. Suppose the capacity currently used to make CMCBs will become idle if Summer purchases CMCBs from Manson. On the basis of financial considerations alone, should Summer make CMCBs or buy them from Manson? Show your calculations. Print Done 3. Now suppose that if Summer purchases CMCBs from Manson, its best alternative use of the capacity currently used for CMCBs is to make and sell special circuit boards (CB3s) to the Essex Corporation. Summer estimates the following incremental revenues and costs from CB3s: Total expected incremental future revenues $2,200,000 Total expected incremental future costs $2,425,000 Check Answer On the basis of financial considerations alone, should Summer make CMCBs or buy them from Manson? Show your calculations