A company is at capacity and has to decide whether to make or buy a new...

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A company is at capacity and has to decide whether to make or buy a new non-patentable product. Below you will see that the controller of the company prepared an in-house cost estimate: Labor Material Overhead Factory Cost SGA Total Cost $10.00 $25.00 $15.00 $50.00 $5.00 $55.00 The purchasing agent looked at the internal cost structure and realized that there were a few errors that needed to be adjusted before he could make a good comparison with the supplier quotes. • Labor costs are 10% less than the initial calculated price because of the misallocation of material handlers in this category. • An additional $2.00 needs to be added because a new machine has to be purchased (tooling). . The cost of materials has increased by 25%. What is the adjusted total cost of this product? A company is at capacity and has to decide whether to make or buy a new non-patentable product. Below you will see that the controller of the company prepared an in-house cost estimate: Labor Material Overhead Factory Cost SGA Total Cost $10.00 $25.00 $15.00 $50.00 $5.00 $55.00 The purchasing agent looked at the internal cost structure and realized that there were a few errors that needed to be adjusted before he could make a good comparison with the supplier quotes. • Labor costs are 10% less than the initial calculated price because of the misallocation of material handlers in this category. • An additional $2.00 needs to be added because a new machine has to be purchased (tooling). . The cost of materials has increased by 25%. What is the adjusted total cost of this product?

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