t.htm 12 3 Exercise 12-3 Make or Buy Decision [LO12-3] 2.5 necessary parts for its engines, including all of the carburetors. An outside supplier has offered to sell one type of Engines, Ltd, for a cost of $35 per unit. To own cost of producing the carburetor internally carburetor to Troy this offer, Troy Engines Ltd, has gathered the following Information relating to lts Unita S14 296,000 0240,000 4 56,000 6 84,000 Direct 1abor Fixed Fixed manufacturing overhead, allocated turing overhead, traceable g the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be e (disadvantage) of buying 14,000 carburetors from the outside supplier? 2. Should the outside supplier's offer be accepted? 3. Suppose that if the carburetors were purchased, Troy Engines, Ltd, could use the freed capacity to launch a new product. The segment margin of the new product would be $140,000 per year. Given this new assumption, what would be financial advantage (disadvantage) of buying 14,000 carburetors from the outside supplier? Prek 30, 6EE Next > 23