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Troy Engines, Lad, manufactures a variety of engines for use in heavy equipment. The company has always produced all of the necessary parts for its
Troy Engines, Lad, manufactures a variety of engines for use in heavy equipment. The company has always produced all of the necessary parts for its engines, including all of the carburetors. An outside supplier has offered to sell one type of carburetor to Troy Engines. Itd. for a cost of $35 per unit. To evaluate this offer, Troy Engines, Led, has gathered the following information relating to its own cost of producing the carburetor Internally 16,00 this Uit De Year Direct materiais $1$200,000 Director 200.000 Variable manufacturing overhead 22.00 Tired facturing ved, tra g. 144,00 Fixed facturing werd allocate 12 102 Total cost $ 40 $714.00 "One-third supervisory anes: two-thirds depreciation of special equipment no resale value); Required 1 Assuming the company has no alternative use for the facilities that are now being used to produce the carburators, what would be the financial advantage overtager of buying 16.000 carburetort from the outside support 2 Should the outside subalter's offer be accepted 3. Suppose that the carburetors were purchased. Troy Engines, Ltd. could use the freed capacity to launch new product The segment margin of the new product would be $160000 or your Glven this new assuroton who would be the financiersdvantage disadvantage of buying 16.000 Carburetors from the outside suple? 4. Given the now sumption in requirement 3. should the outside supports offer be accepted! Answer is complete but not entirely correct, Complete this question by entering your answers in ers in the tabs below Suppose that the carburetort were purchases. To Engles Ltd could use the freed capacity to launch a new product. The rement mag of the new product would be $150.000 per van Oiven the motion, what woud be the financial vantage davantage) buying 16.000 carburetors from the outside wppler FANS 04000 3 S
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