Troy Engines, Ltd., manufactures a variety of engines for use in heavy equipment. The 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., unit. To evaluate this offer, Troy Engines, Ltd., has gathered the following information relating to its own cost of producing the carburetor internally: company has for a cost of $35 per 15,000 Units Per Unit Per Year $14 $ 210,000 150,000 45,000 90,000 135,000 $42 $630,000 Direct materials Direct labor 10 Variable manufacturing overhead ixed manufacturing overhead, traceable 6* Fixed manufacturing overhead, allocated Total cost One-third supervisory salaries; two-thirds depreciation of special equipment (no resale value). Required: 1a. Assuming that the company has no alternative use for the facilities that are now being used to produce the carburetors, compute the total cost of making and buying the parts. Required: 1a. Assuming that the company has no alternative use for the facilities that are now being used to produce the carburetors, compute the total cost of making and buying the parts. 625000 Make Buy Total relevant cost (15,000 units) 1b. Should the outside supplier's offer be accepted? $625,000 $525,000 Accept Reject