Using Excel to Assess a Make or Buy Decision PROBLEM

Manson Industries makes an assembly part for its finished product. A supplier has offered to produce the assembly part. Information concerning the assembly part follows.

$\backslash$table$[[$Unit cost to make product,$],[$Variable$,5\mathrm{.}00],[$Fixed$,3\mathrm{.}00],[$Offer by supplier to produce,$6\mathrm{.}00],[$Per unit,$10,000],[$Number of units,$]]$

If the offer is accepted, Manson will save all variable costs but no

fixed coste

fixed costs

Student Work Area

Required: Provide input into cells shaded in yellow in this template. Use mathematical formulas with cell references to the Problem area or work area as indicated. Type the number zero in any field in the Make or Buy columns for which there is no cost$.$

Prepare an analysis using Excel's IF function showing the total cost saving, if any, Manson will realize by buying the part.