QUESTION 1 As the CEO of Hakoopian clothing company you want to decide whether to manufacture a particular product or ou

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Question 1 As The Ceo Of Hakoopian Clothing Company You Want To Decide Whether To Manufacture A Particular Product Or Ou 1 (58.24 KiB) Viewed 34 times

QUESTION 1 As the CEO of Hakoopian clothing company you want to decide whether to manufacture a particular product or outsource its production. Your business analysis team develops a spreadsheet model and uses Excel's What If analysis to analyze "Savings due to Outsourcing" based on different scenarios. The results below are provided to you as the CEO. B D G H к 1 M N Parameters 2 Outsourcing Cost per unit s 4.50 Savings due to outsourcing per prod. volume Savings due to outsourcing per prod. volume and outsource cost per unit 3 Prod. Vol. 5 14,500.00 $ 14,500.00 4.20 $ 4.355 4.50 $ 4.655 4.80 4 Foxed Cost $ 25,000.00 10000 $21,500 10000 $24,500 $23.000 $21.500 $20,000 $18.500 5 Material cost per unit $ 2.15 20000 $18,000 20000 $24,000 $21.000 $18.000 $15,000 $12,000 6 Labor cost per unit $ 2.00 30000 $14,500 10000 $23.500 $19,000 $14.500 510,000 $5,500 7 40000 $11,000 40000 $29.000 $17,000 511,000 $5,000 $1.000 8 Model 50000 $7,500 SODOD $22.500 $15,000 $7,500 50 (57,500 9 Production Volume 30000 6000 $4,000 60000 $22.000 $13,000 $4,000 (55,000 $14.000 10 70000 $500 70000 $21.500 $11,000 $500 $10,000) $20.500) 11 Total Outsource Cost 5 135,000.00 10000 153,000 30000 $21.000 $9,000 $3.000 15.000) (527,000 12 90000 156 500 90000 $20,500 $7.000 156.00 $20.000) ($33,500) 13 Total Fixed Cost $ 25,000.00 100000 1510.000 100000 $20.000 $5,000 51000 525.000) $40.000) 14 Total Material Cost $ 54,500.00 The outsourcing cost per unit is $450 The amounts in parantare Argoties 15 Total Labor Cost $ 60,000.00 The amounts in parentheses are gootive foss The first left most column represents the production volume 16 Total Cost $ 149,500.00 Left column represent production volume The top row amounts represent "Outsourcing Cost per unit." 17 Right column represent "Savings due to outsourcing The amount in each cell represent Savings dur to outsourcing 18 Savings due to outsourcing $ 14,500.00 19 Assuming that the company to which you outsource charges you 54.80 per unit, based on the results above, which range for production volume contains the break-even point? 10,000 to 20,000 O 20,001 to 30,000 O 30,001 to 40,000 40,001 to 50,000 50,001 to 60,000 60,001 to 70,000 70,001 or more It cannot be determined.