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X-Perience manufactures snowboards. Its cost of making 23,600 bindings is as follows: (Click the icon to view the costs.) Suppose an outside supplier will

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X-Perience manufactures snowboards. Its cost of making 23,600 bindings is as follows: (Click the icon to view the costs.) Suppose an outside supplier will sell bindings to X-Perience for $18 each. X-Perience will pay $2.00 per unit to transport the bindings to its manufacturing plant, where it will add its own logo at a cost of $0.60 per binding. Read the requirements. Requirement 1. X-Perience's accountants predict that purchasing the bindings from the outside supplier will enable the company to avoid $2,600 of fixed overhead. Prepare an analysis to show whether the company should make or buy the bindings. (Enter a "0" for any zero balances. Round any per unit amounts to the nearest cent and your final answers to the nearest whole dollar. Use a minus sign or parentheses in the Difference column when the cost to make exceeds the cost to buy.) Incremental Analysis Outsourcing Decision Make Bindings Buy (Outsource) Bindings Difference Variable Costs Plus: Fixed Costs Total cost of 23,600 bindings Decision: Requirement 2. The facilities freed by purchasing bindings from the outside supplier can be used to manufacture another product that will contribute $2,700 to profit. Total fixed costs will be the same as if X-Perience had produced the bindings. Show which alternative makes the best use of X-Perience's facilities: (a) make bindings, (b) buy bindings and leave facilities idle, or (c) buy bindings and make another product. (Enter a "0" for any zero balances. Round any per unit amounts to the nearest cent and your final answers to the nearest whole dollar.) Incremental Analysis (a) Make Buy (Outsource) Bindings (b) Leave (c) Make Outsourcing Decision Binding Facilities Idle Another Product Variable Costs Plus: Fixed Costs Total cost of 23,600 bindings Less: Profit from another product Enter any number in the edit fields and then continue to the next question. Data Table Direct materials.. $ Direct labor.. 24,000 82,000 Variable manufacturing overhead..... 48,000 82,000 Fixed manufacturing overhead $ 236,000 Total manufacturing costs... ? Cost per pair ($236,000 + 23,600) ..... S 10.00

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