A Moving to another question will save this response. Question 8 For many years Thompson Company has purchased the pulleys that it installs in its standard line of vacuum cleaners. Due to a reduction in output of certain of its products, the company has idle capacity that could be used to produce the pulleys. The number of pulleys that the company currently purchases (and would need to make) is 30,000. The chief engineer has recommended against this move, however, pointing out that the cost to produce the pulleys would be greater than the current $5.65 per unit purchase price: Direct materials Direct labor Supervision Depreciation Variable overhead Rent TOTAL COST Per Unit $2.30 Total 1.60 .45 .70 $13,500 21,000 0.85 0.30 $6.20 9,000 Question 8 of 26 4 points Save Answe A supervisor would have to be hired to oversee production of the pulleys. However, the company has sufficient idle tools and machinery that no new equipment would have to be purchased. The rent charge above is allocated based on space utilized in the plant. The total rent on the plant is $54,000 per period. The dollar advantage or disadvantage per period of making the pulleys would be: a. $18,750 Disadvantage b. $13,500 Advantage c. $62,250 Advantage d. $31,150 Disadvantage Moving to another question will save this response.