Exam Practice Problems - Sawad Lee Miller - AutoSave GH File Home a 2 insert .8 Draw ; Page Layout X Comments Formulas Data Review View Help Search LUCopy # E Normal Bad AR A Times New Roma 12 BIU - Font === = Wrap Text Merge & Center - General $ - % EX Insert Dute Format Share 4 Ideas 0 Hindi Select AutoSum - 47 Sort Clear Filter Editing - Neutral *** Format Painter Clipboard Conditional Formal as Good Formatting Table Styles Alignment Number Ideas B C D E F G H I J K A 1 Problem 3 3 Make or Buy Decision 4 5 Marshall Company currently manufactures one of its parts at a cost of $3.25 per unit. This cost is based 6 on a normal production rate of 50,000 units. Variable costs are $2.10 per unit, fixed costs related to making 7 this part are $40,000 per year, and allocated fixed costs are $45,000 per year. Allocated fixed costs are 8 unavoidable whether the company makes or buys the part. Marshall is considering buying the part from a 9 supplier for a quoted price of $2.80 per unit guaranteed for a three-year period. 10 11 Required: 12 Should the company continue to manufacture the part, or should it buy the part from the outside supplier? 13 Support your answer with calculations. 14 16 + Start >> Problem 1 Problem 2 Problem 3 Problem 4 Problem 5 Display Settings M - + 2209 I Type here to search A 40 1651 1/24/2020