Outdoor Life manufactures snowboards. Its cost of making 1,700 bindings is as follows: (Click the loon...

 

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Outdoor Life manufactures snowboards. Its cost of making 1,700 bindings is as follows: (Click the loon to view the costs.) Suppose Topnotch will sell bindings to Outdoor Life for $15 each. Outdoor Life would pay $3 per unit to transport the bindings to its manufacturing plant, where it would add its own logo at a cost of $0.60 per binding. Read the requirements. Requirement 1. Outdoor Life's accountants predict that purchasing the bindings from Topnotch will enable the company to avoid $2,600 of fixed overhead. Prepare an analysis to show whether Outdoor Life should make or buy the bindings. minus sign or parentheses only when the cost of outsourcing exceeds the cost of making the bindings in-house.) Variable costs: Binding costs Direct materials Direct labor Variable overhead Fixed costs Purchase price from Topnotch Transportation Logo Total differential cost of 1,700 bindings Should Outdoor Life make or buy the bindings? Decision: Variable Costs: Binding costs Direct materials Direct labor Variable overhead Fixed costs Purchase price from Topnotch Transportation Make Bindings Logo Expected profit from new product Expected net cost of obtaining 1,700 bindings Outsource Bindings Make Bindings Difference (Make-Outsource) Requirement 2. The facilities freed by purchasing bindings from Topnotch can be used to manufacture another product that will contribute $3.100 to profit. Total fixed costs will be the same as if Outdoor Life had produced the bindings. Show enter the net relevant costs. Enter all costs as positive values. Use a minus sign or parentheses for decreases to net costs.) Which alternative makes the best use of Outdoor Life's facilities? Outsource Bindings Make New Product Facilities Idle Enter any number in the edit fields and then continue to the next question. Data Table Direct materials Direct labor Variable overhead Fixed overhead Total manufacturing costs for 1,700 bindings Print Done $ $ 17,540 2,800 2,070 7,000 29,410 Outdoor Life manufactures snowboards. Its cost of making 1,700 bindings is as follows: (Click the loon to view the costs.) Suppose Topnotch will sell bindings to Outdoor Life for $15 each. Outdoor Life would pay $3 per unit to transport the bindings to its manufacturing plant, where it would add its own logo at a cost of $0.60 per binding. Read the requirements. Requirement 1. Outdoor Life's accountants predict that purchasing the bindings from Topnotch will enable the company to avoid $2,600 of fixed overhead. Prepare an analysis to show whether Outdoor Life should make or buy the bindings. minus sign or parentheses only when the cost of outsourcing exceeds the cost of making the bindings in-house.) Variable costs: Binding costs Direct materials Direct labor Variable overhead Fixed costs Purchase price from Topnotch Transportation Logo Total differential cost of 1,700 bindings Should Outdoor Life make or buy the bindings? Decision: Variable Costs: Binding costs Direct materials Direct labor Variable overhead Fixed costs Purchase price from Topnotch Transportation Make Bindings Logo Expected profit from new product Expected net cost of obtaining 1,700 bindings Outsource Bindings Make Bindings Difference (Make-Outsource) Requirement 2. The facilities freed by purchasing bindings from Topnotch can be used to manufacture another product that will contribute $3.100 to profit. Total fixed costs will be the same as if Outdoor Life had produced the bindings. Show enter the net relevant costs. Enter all costs as positive values. Use a minus sign or parentheses for decreases to net costs.) Which alternative makes the best use of Outdoor Life's facilities? Outsource Bindings Make New Product Facilities Idle Enter any number in the edit fields and then continue to the next question. Data Table Direct materials Direct labor Variable overhead Fixed overhead Total manufacturing costs for 1,700 bindings Print Done $ $ 17,540 2,800 2,070 7,000 29,410

Answer rating: 100% (QA)

Solution 1 Differential Analysis Make or Buy Outdoor Life Particulars Make Bindings Outsource B... View the full answer