Question: Outsourcing ( Make - or - Buy ) Decision per unit of an auto air purifier follows. These cost predictions include $ 4 5

Outsourcing (Make-or-Buy) Decision per unit of an auto air purifier follows.
These cost predictions include \$450,000 in fixed factory overhead averaged over 50,000 units. purifier by 50 percent.
- Calculate the net advantage (disadvantage) of outsourcing the electric motors from Mini Motor Company.
- Use a negative sign with your answer to indicate a net disadvantage of outsourcing (if applicable.)
(b) If it could otherwise rent the motor-assembly space for \$50,000 per year, should it make or outsource this component?
- Calculate the net advantage (disadvantage) of outsourcing the motors, assuming the space could be rented.
- Use a negative sign with your answer to indicate a net disadvantage of outsourcing (if applicable).
(c) What additional factors should it consider in deciding whether to make or outsource the electric motors?
OThe quality of their own and the supplier's motors.
OThe dependability of the supplier.
OWhether Mini Motor has a track record of meeting its commitments.
OWhether they can depend on Mini Motor to supply motors for a number of years or whether it is attempting to use some temporarily idle capacity.
OAll of these.
Outsourcing ( Make - or - Buy ) Decision per unit

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