Each year, Basu Company produces 14,000 units of a component used in microwave ovens. An outside supplier has offered to supply the part for $1.28. The unit cost is: Direct materials $0.83 Direct labor 0.33 Variable overhead 0.06 Fixed overhead  2.65    Total unit cost $3.87 Required: 1. What are the alternatives for Basu Company?   2. Assume that none of the fixed cost is avoidable. List the relevant cost(s) of internal production.   List the relevant cost(s) of external purchase.   3. Which alternative is more cost effective and by how much?   by $fill in the blank 5 4. What if $21,520 of fixed overhead is rental of equipment used only in production of the component that can be avoided if the component is purchased? Which alternative is more cost effective and by how much?   by $fill in the blank 7

Q: Jabari Manufacturing, a widgets manufacturing company, divides its production operations into three…

A: Cost per unit is calculated by dividing the total cost by the number of units produced.

Q: Alibangbang Company produces 100,000 units of Part 34B, used in one of its snowblower engines, each…

A: Variable cost means the cost which vary with the level of output where as fixed cost remain fixed…

Q: Part E43 is used in one of Ran Corporation's products. The company's Accounting Department reports…

A:

Q: Each year, Basu Company produces 21,000 units of a component used in microwave ovens. An outside…

A: Formula: Differential cost = Making - Buying

Q: Cardinal Company needs 20,000 units of a certain part to use in its production cycle. The following…

A: When a business has to choose between two alternatives one is purchasing from outside and other is…

Q: your company uses a total of 20,000 units of a part that are produced and used every year. The…

A: No of Units to be produced 20000 Outside supplier's price of a part $ 35   If the produced part…

Q: Manama Inc. is now producing TVs. The company’s accounting department reports the following costs of…

A: Make or buy decision-  The technique of marginal costing helps the management decide  whether to…

Q: Supler Corporation produces a part used in the manufacture of one of its products. The unit product…

A: Relevant unit product costs = Direct material + direct labor + variable manufacturing overhead +…

Q: The Park Avenue Corporation currently makes a part required in its finished product.  The company…

A: Manufacturing Cost: Manufacturing costs are the cost which is incurred for producing or…

Q: Rubium Micro Devices currently manufactures a subassembly for its main product. The costs per unit…

A: Relevant cost of Making = (Direct material + labor cost + variable overhead) x no. of units +…

Q: ABC Manufacturing Corp. is using 10,000 units of part no. 300 as a component to assemble one of its…

A: Make or Buy decisions are referred to as taking decision regarding either to produce the product…

Q: Plummer Company makes 4,000 units per year of a part called an axial tap for use in one of its…

A: Formulas:

Q: Cruise Company produces a part that is used in the manufacture of one of its products. The unit…

A: SOLUTION- Manufacturing cost is the sum of costs of all resources consumed in the process of making…

Q: Motor Company manufactures 10,000 units of Part M-I each year for use in its production. The…

A: Relevant cost to make = Direct materials + Direct labor + Variable manufacturing overhead +…

Q: Han Products manufactures 57,500 units of part S-6 each year for use on its production line. At this…

A: Part 1: Workings: Net dollar Advantage accepting the outside supplier's offer=$154,228.

Q: Plainfield Company manufactures part G for use in its production cycle. The full cost per unit for…

A: Per unit Total 10000 units   Make Buy Make Buy Direct materials 2     20,000     Direct…

Q: in one of fts products. A total of 5,000 units of this part are produced and used every year. The…

A: Make or buy is the decision to be made by the entities to decide that the products if made will be…

Q: Erika Company makes 70,000 units per year of a part it uses in the products it manufactures. The…

A: Every business organization aims is to earn maximum profit, In the competitive environment is it not…

Q: Part U67 is used in one of Broce Corporation's products. The company's Accounting Department reports…

A: In the given question the Relevant cost to Make should be compared with Relevant cost to Buy.  If…

Q: Toyang Inc. produces 100,000 units of Part 34B, used in one of its snowblowerengines, each year. An…

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Ahron Company makes 8,000 units per year of a part it uses in the products it manufactures. The unit…

A: Here we will use the concept of relevant costs. In accounting a cost is considered relevant when it…

Q: Han Products manufactures 55,500 units of part S-6 each year for use on its production line. At this…

A: SOLUTION- COMPUTATION OF RELEVANT COST PER UNIT- PARTICULARS AMOUNT DIRECT MATERIAL 6.660…

Q: Wolley Inc. uses part A68 in one of its products. The company's Accounting Department reports the…

A: Lets understand the basics. When there is option between the buy and make then management calculate…

Q: Dixon Company manufactures part 347 for use in one of its main products. Normal annual production…

A: Fixed costs per 100 units = $160 Total units = 100,000 units Total fixed costs = $160 x 100,000 /…

Q: The Park Avenue Corporation currently makes a part required in its finished product. The company…

A: When there are alternatives of manufacturing the product inhouse or purchase from outside vendor ,…

Q: Your Company uses a total of 15,000 units of a part that are produced and used every year. The…

A: Make cost is the cost of producing the product internally. Buy cost is the cost to purchase the…

Q: Sardi Inc. is considering whether to continue to make a component or to buy it from an outside…

A: Make or Buy Decision making When Machine hours/Other production capacity is limited, then machine…

Q: Sardi Incorporated is considering whether to continue to make a component or to buy it from an…

A: Manufacturing costs that vary roughly in response to shifts in production output are referred to as…

Q: Selma Corporation uses Part PB7 in one of its products. The company's Accounting Department reports…

A: Relevant costing is a costing technique that eliminates the usage of historical or unavoidable costs…

Q: the amount of the relevant costs that would be saved by using the released facilities in the…

A: Given in the question: Production (in Units) 20000 Cost per unit is as below:   Direct…

Q: Carver Company manufactures a component used in the production of one of its main products. The…

A: Fixed overheads are the overheads which are incurred for an accounting period that, within certain…

Q: EIric Corporation currently manufactures a part in-house that is a main component of its most…

A: Calculation of Net advantage of Buying the product from outside market   Make  Amount   Buy…

Q: Comet, Inc. has been experiencing the following costs when it produces 12,000 units of a…

A: The question is related to make or buy the product from outside. If we have to choose amomgst the…

Q: Part S51 is used in one of Haberkorn Corporation's products. The company makes 12,000 units of this…

A: General company overheads (other than avoidable general overhead cost of $ 17,000) is a sunk cost…

Q: Ring Company makes telephones. Currently, Ring makes all components of the telephones in-house. An…

A: Total cost of a product includes both variable and fixed cost. Variable cost further includes direct…

Q: Hanson, Inc. makes 1,000 units per year of a part called a prositron for use in one of its products.…

A: This question deals with the question of decision making and relevant costing. In decision making,…

Q: he James Company manufactures widgets that sell for $120 each. The company's unit cost for each…

A: Solution: Relevant cost of making = Direct materials + direct labor + variable overhead  = 30+40 +…

Q: Dexter Company manufactures part ZX used in several of its engine models. Monthly production costs…

A: Variable cost means the cost which vary with the level of output and fixed cost means the cost which…

Q: relevant cost(

A: [Note: Since you have posted a multi-part question, we will solve the first three parts for you. For…

Q: Kramer Company, makes 3,000 units every year of a component called Axial Tap for use in one of its…

A: Hello. Since your question has multiple parts, we will solve first question  for you. If you want…

Q: Wings Incorporated manufactures machine parts for aircraft engines. The CEO, Chucky Valters, was…

A: Make or Buy Decision: The process of deciding whether to produce a product or service in-house or to…

Q: CM Manufacturing has provided the following unit costs pertaining to a component they manufacture…

A: The fixed manufacturing overhead is unavoidable. Therefore, it should not consider for the Make or…

Q: Supler Corporation produces a part used in the manufacture of one of its products. The unit product…

A: Financial Advantage: The financial advantage is the saving per unit from the buy decision instead of…

Q: The company has always produced all of the necessary parts for its engines, including all of the…

A: Make or buy decision: The decision relating to manufacture a product or buy a product by taking into…

Q: 1. What are the alternatives facing Zion Manufacturing with respect to  List the relevant costs for…

A: Make or Buy Decision Make or Buy decision is the action taken by a producer to either make/produce a…

Q: Ahrends Corporation makes 70,000 units per year of a part it uses in the products it manufactures.…

A: Avoidable fixed manufacturing overhead = total fixed manufacturing overhead - applied fixed…

Q: Assume that a company manufactures numerous component parts, one of which is called Part A. The…

A: Introduction:- Assume a corporation produces a variety of component components, one of which is…

Q: Crown Company, which needs 10,000 units of a certain part to be used in its production cycle, can…

A: Relevant cost can be defined as any cost which is relevant to a decision. It is also called as…

Q: mickey comapny uses 5000 units of pat Z each year as a component in the assembly of one of its…

A: Under make or buy decision,  If the cost savings are more than the cost to buy external source then…