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Llana [10]
3 years ago
10

An outside supplier has offered to make and sell the part to the company for $24.10 each. If this offer is accepted, the supervi

sor's salary and all of the variable costs can be avoided. The special equipment used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represents fixed costs of the entire company, none of which would be avoided if the part were purchased instead of produced internally. If management decides to buy part Z95 from the outside supplier rather than to continue making the part, what would be the annual impact on the company's overall net operating income
Business
1 answer:
Soloha48 [4]3 years ago
8 0

Answer:

Net operating income would decrease by $36,000 per year.

Explanation:

The company's current cost of manufacturing a part Z95 is $33.9 which includes all the material, labor and overhead costs. If the company buys this part from an outside supplier it will cost $24.10 each. but the depreciation and factory overhead cannot be avoided. The depreciation is $5.40  and factory overheads are $8.60. This will be added to the cost of buying each part.

$24.10 + $5.40 + $8.60 = $38.1

The cost of buying the part is greater than the cost of making it.

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Answer:

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Explanation:

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7 0
3 years ago
What are some strategies that you can use when agreeing to a contract to protect yourself?
suter [353]
You can go over with a lawyer and see what you can do to help you
8 0
3 years ago
Select the correct answer.
TEA [102]
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7 0
2 years ago
In the simple Keynesian model, Multiple Choice Inflation becomes a problem only if demand increases at full employment. Inflatio
ElenaW [278]

Answer:

In the simple Keynesian model, inflation becomes a problem only if demand increases at full employment.

Explanation:

In the Keynesian view, price inflation is mainly the result of relative changes in supply and demand, which lead to price changes. Changes in the money supply have no direct influence here. According to this school, the money supply is the result of money creation by the banking system; but this plays only a limited role in the process.

In this vision, a distinction is made between:

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7 0
3 years ago
Under normal conditions (70% probability), Plan A will produce $20,000 higher return than Plan B. Under tight money conditions (
Lorico [155]

Answer:

A. ($16,000)

Explanation:

The computation of the expected value of return equal to

=  (Higher return × probability rate) - (Less return -  probability rate)

= ($20,000 × 70%) - ($100,000 × 30%)

= $14,000 - $30,000

= - $16,000

For computing the correct value we have to deduct the tighter money conditions from the normal conditions.

3 0
3 years ago
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