Question: QUESTION HELP You currently make a part on old equipment at a cost of $50,000 per year and a variable cost of $20 / unit.

QUESTION HELP

You currently make a part on old equipment at a cost of $50,000 per year and a variable cost of $20 / unit. You have found an outside supplier who will make the part for $15 / unit if you will pay their annual fixed costs of $200,000/year. The following table summarizes the details of this make versus buy decision. FIXED COST ALTERNATIVE Buy Make $200,000 per year 350,000 per year VARIABLE COST $15 per unit $20 per unit What is the break even quantity between buying and making? 1) 30,000 units per year 2) 40,000 units per year 03) 50,000 units per year 4) 60,000 units per year

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!

The Little Steel Company is a small steel fabricator that makes steel parts for various metal machine shop clients. When Little Steel Company receives an order from a client, it must locate and...

You currently make a part on old equipment at a cost of $50,000 per year and a variable cost of $20/ unit. You have found an outside supplier who will make the part for $15 / unit if you will pay...

You currently make a part on old equipment at a cost of $ 5 0 , 0 0 0 per year and a variable cost of $ 2 0 / unit. You have found an outside supplier who will make the part for $ 1 5 / unit if you...

You currently make a part on old equipment at a cost of $50,000 per year and a variable cost of $20 / unit. You have found an outside supplier who will make the part for $15/ unit if you will pay...

Scenario 12.1 You currently make a part on old equipment at a cost of $50,000 per year and a variable cost of $20 / unit. You have found an outside supplier who will make the part for $15 / unit if...

You currently make a part on old equipment at a cost of $286,000 per year and a variable cost of $7 per unit. You have found an outside supplier who will make the part for $14 per unit if you will...

You currently make a part on old equipment at a cost of $50,000 per year and a variable cost of $20 / unit. You have found an outside supplier who will make the part for $15 / unit if you will pay...

1. You currently make a part on old equipment at a cost of $20 / unit. The annual fixed cost for thisequipment is $50,000. You have found an outside supplier who will make the part for $15 / unit...

You currently make a part for old equipment at a cost of $ 2 0 / unit. The annual fixed cost for this equipment is $ 5 0 , 0 0 0 . You have found an outside supplier who will make the part for $ 1 5...

3. The volume, v cubic metres, of water in a reservoir varies with time t, in minutes. When a valve is opened the relationship between v and t is given by: v = 3*104-16t2-8t3. Calculate the rate of...

The probability that an American industry will locate in Shanghai, China is 0.7, the probability that it will locate in Beijing, China is 0.4, and the probability that it will locate in cither...

Financial reporting refers toc Muttiple Cholce Roso andysis only Profitabity The application of analytical toots to generel - purpose financial statemerts. General - purpose financial statements only...

When older adults have difficulty with transportation and communication, or may be reluctant to request needed assistance to which they are entitled, they may be in need of: Group of answer choices...