Question: Do not copy else i will report it. DO only if sure. Emil Manufacturing incurs unit costs of $7.20 ($5.20 variable and $2.00 fixed) in
Do not copy else i will report it. DO only if sure. 
Emil Manufacturing incurs unit costs of $7.20 ($5.20 variable and $2.00 fixed) in making a sub-assembly part for its finished product. A supplier offers to make 12,600 of the parts for $5.80 per unit. If it accepts the offer, Emil will save all variable costs and $1 of fixed costs. Prepare an analysis showing the total cost savings, if any, that Emil will realize by buying the part. (Round per unit answers to 2 decimal places, e.g. 15.25. If an amount reduces the net income then enter with a negative sign preceding the number, e.g.-15,000 or parenthesis, e.g. (15,000).) Net Income Increase (Decrease) Per Unit Make Buy Number of units: Variable manufacturing costs $ Fixed manufacturing costs Purchase price Total annual cost The decision should be to make the part
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
