View previous attempt 3 Exercise 13-11 (Algo) Make or Buy Decision (LO13-3) 2 Han Products manufactures 37,000 units of

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View Previous Attempt 3 Exercise 13 11 Algo Make Or Buy Decision Lo13 3 2 Han Products Manufactures 37 000 Units Of 1 (25.59 KiB) Viewed 53 times

View previous attempt 3 Exercise 13-11 (Algo) Make or Buy Decision (LO13-3) 2 Han Products manufactures 37,000 units of part 5-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: Direct materials 5 3.60 Direct labor 9.00 Variable manufacturing overhead 2.40 Fixed sanufacturing overhead 6.00 Total cost per part $ 21.00 An outside supplier has offered to sell 37,000 units of part S6 each year to Han Products for $19 per part. If Han Products accepts this offer, the facilities now being used to manufacture part S6 could be rented to another company at an annual rental of $87,000 However, Han Products has determined that two thirds of the fixed manufacturing overhead being applied to part 5-6 would continue even if part 5-6 were purchased from the outside supplier Required: What is the financial advantage disadvantages of accepting the outside supplier's offer? Financial advantage 61.000