Troy Engines, Limited, 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, Limited, for a cost of $$35$ per unit. To evaluate this offer, Troy Engines, Limited, has gathered the following information relating

to its own cost of producing the carburetor internally:

$*$One$-$third avoidable supervisory salaries; two$-$thirds depreciation of special equipment $($no resale value$).$

Required:

Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be

the total financial impact of buying $22,000$ carburetors from the outside supplier? $($Indicate negative cash flows with a negative sign.$)$

Should the outside supplier's offer be accepted?

Suppose that if the carburetors were purchased, Troy Engines, Limited, could use the freed capacity to launch a new product. The

segment margin of the new product would be $$220,000$ per year. $($Assume that the carburetor supervisor would still not keep their

job.$)$ Given this new assumption, what would be the total financial impact of buying $22,000$ carburetors from the outside supplier?

Given the new assumption in requirement $3,$ should the outside supplier's offer be accepted?