Question: Question 11 (10 points) Cubic Limited currently produces all components for its most popular computer monitor. A supplier has approached Cubic with an opportunity to

 Question 11 (10 points) Cubic Limited currently produces all components for

Question 11 (10 points) Cubic Limited currently produces all components for its most popular computer monitor. A supplier has approached Cubic with an opportunity to purchase part X for $18 per unit. The cost breakdown for Cubic to produce each monitor is: direct labour: $12/unit: direct materials: $4/unit: variable manufacturing overhead: $1.75/unit: and fixed manufacturing overhead: $4.25/unit If Cubic decides to purchase the part instead of continuing to manufacture it, they would reduce direct labour costs by $9/unit and reduce direct materials by $2.40/unit. Cubic produces 22.000 of this model each year. Required. Prepare an analysis of both options for the Production Manager. Your analysis must include a recommendation of whether Cubic should purchase part from an external supplier or continue to manufacture the part. WRITE YOUR ANSWER ON A SHEET OF PAPER AND UPLOAD IT TO YOUR BRIGHTSPACE DROPBOX SHOW ALL WORKINGS

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