Answer:
($100,350)
Explanation:
<u>Relevant cost to make</u>
Per Unit 14,500 units
Direct materials $3.20 $46,400
Direct labor $7.80 $113,100
Variable manufacturing overhead $8.30 $120,350
Supervisor's salary $3.70 $53,650
Relevant cost to make $23 $333,500
<u>Relevant Cost to buy</u>
Per Unit 14,500 units
Purchase price $32.30 $468,350
Less: Additional segment margin <u>$34,500</u>
Relevant Cost to buy <u>$433,850</u>
Here, we have financial disadvantage to buy as Relevant cost to make is lesser than Relevant Cost to buy
Financial (Disadvantage to buy) = $333,500 - $433,850
Financial (Disadvantage to buy) = ($100,350)