Question: could you clarify the question and make excel sheet to it? 13.21 Samsung Electronics is trying to reduce supply chain risk by making more responsible

could you clarify the question and make excel sheet to it? 13.21

could you clarify the question and make excel sheet to it?

13.21 Samsung Electronics is trying to reduce supply chain risk by making more responsible make-buy decisions through improved cost estimation. A high-use component (expected usage is 5000 units per year) can be purchased for $25 per unit with delivery promised within a week. Alternatively, Samsung can make the component in-house and have it readily available at a cost of $5 per unit, if equipment costing $150,000 is purchased. Labor and other operating costs are estimated to be $35,000 per year over the study period of 5 years. Salvage is estimated at 10% of first cost and i=12% per year. Neglect the element of availability (a) to determine the breakeven quantity and (b) to recommend making or buying at the ex- S=150,0000.18 A: pected usage level. (a) Tcos+A=25QTcos+B=FC+VeF=150,000(A/P,10%,5)35,000+15,000(A/F,10%,5)=$72,112.66VC=5Q T.eost B=72,112.665Q At BE : T.CostA25QBEQBE=Tcos+B=72,112.665QBE=3605.63units/year (b) 5000>3605.63 select making option

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