Should the company buy or make the product

Assignment Help Accounting Basics

Reference no: EM132217962

Question - Submit a paper which is 2-3 pages in length (no more than 3-pages), exclusive of the reference page.

In this paper, please discuss the following case study. In doing so, explain your approach to the problem, support your approach with references, and execute your approach. Provide an answer to the case study's question with a recommendation.

Case Study: Assume that a firm has prepared the following cost estimates for the manufacture of a sub assembly component based on an annual production of 8,000 units.

	Per Unit	Total
Direct materials	$5	$40,000
Direct labor	$4	$32,000
Variable factory overhead applied	$4	$32,000
Fixed factory over head applied (150% of direct labor cost)	$6	$48,000
Total Cost	$19	$152,000

The supplier has offered to provide the subassembly at a price of $16 each. Two-thirds of fixed factory overhead, which represents executive salaries, rent, depreciation, and taxes, continue regardless of the decision. Should the company buy or make the product?

Reference no: EM132217962

Questions Cloud

Why is the ability to reward : Why is the ability to reward and determine ownership of creative works becoming more problematic in today’s world? What are the possible solutions?

What are the primary challenges of organizational teams : What are the primary challenges of organizational teams and how are Tuckman's stages of team development involved? Looking at an emotional intelligence (EI).

Disadvantage of outsourcing entire staffing system to vendor : What would be the advantages and disadvantages of outsourcing the entire staffing system to a vendor?

FBI wanted Apple to create software to unlock iPhone : In early 2016, the FBI wanted Apple to create software to unlock an iPhone 5C used by Syed Farook, Which side are you on? The FBI or Apple? Explain.

Should the company buy or make the product : The supplier has offered to provide the subassembly at a price of $16 each. Should the company buy or make the product

Discuss how this might be used in other businesses : Create a PowerPoint presentation to inform a group of managers about the growth of data analytics. discuss how this might be used in other businesses

Analyze and compare options when presented with problem : What medical, mental, and physical issues are affecting the population segment aged 65 and older in the United States?

How much is cost of goods sold for february : Gate Grocery's most popular candy bars cost $0.50 each and sell for $0.75. How much is cost of goods sold for February

Describe positive and negative participation behaviors : Analyze the group norms and the impact on organizational communication. Norms are the formal and informal rules groups develop.

Reviews

len2217962

1/17/2019 10:38:19 PM

Submit a paper which is 2-3 pages in length (no more than 3-pages), exclusive of the reference page. Paper should be double spaced in Times New Roman (or its equivalent) font which is no greater than 12 points in size. The paper should cite 2-3 sources in APA format. One source can be your textbook.

Write a Review

Required(*) Message

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

User Account

All Pages