Troy Engines, Ltd., 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, Ltd., for a cost of $34 per unit. To evaluate this offer, Troy Engines, Ltd., has gathered the following information relating to its own cost of producing the carburetor internally:

Troy Engines, Ltd., 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, Ltd., for a cost of $34 per unit To evaluate this offer. Troy Engines. Ltd.. has gathered the following information relating to its own cost of producing the carburetor internally: 19,033 Per Units Unit Per Year Direct materials 5 15 5 364,666 Direct labor 10 198,660 Variable manufacturing overhead 2 38,660 Fixed manufacturing overhead, traceable 9* 1?1,BB Fixed manufacturing overhead, allocated 12 223,600 Total cost in 4+3 5 931,509 l *One-third supervisory salaries; 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 carburetors, what would be the financial advantage {disadvantage} of buying 19,000 carburetors from the outside supplier? 2- Should the outside supplier's offer be accepted? 3. Suppose that ifthe carburetors were purchased, Troy Engines, Ltd., could use the freed capacity to launch a new product. The segment margin of the new product would be 521907000 per year. Given this new assumption, what would be the financial advantage {disadvantage} of buying 19,000 carburetors from the outside supplier? 4. Given the new assumption in requirement 3, should the outside supplier's offer be accepted? Complete this queslion by entering your answers in the '3le below. Required 1 Required 2 Required 3 U Required 4 Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the nancial advantage (disadvantage) of buying 19,000 carburetors from the outside supplier? :ZI Required 1 Required 2 Required 3 Required 4 Suppose that if the carburetors were purchased, Troy Engines, Ltd., could use the freed capacity to launch a new product. The segment margin of the new product would be $190,000 per year. Given this new assumption, what would be the financial advantage (disadvantage) of buying 19,000 carburetors from the outside supplier