Han Products manufactures 60,000 units of parts 6 each year for use on its production tine. At this level of activity, t

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Han Products Manufactures 60 000 Units Of Parts 6 Each Year For Use On Its Production Tine At This Level Of Activity T 1 (29.74 KiB) Viewed 35 times

Han Products manufactures 60,000 units of parts 6 each year for use on its production tine. At this level of activity, the cost per unit for port S6 is as follows: Direct materials Direct Labour Variable overhead Fixed overhead Total cost per part $ 6.50 12.50 5.50 10.00 535.30 An outside supplier has offered to sell 53.000 units of part S6 each year to Han Products for $3100 per part If Han Products accepts this offer, the facilities now being used to manufacture port 5-6 could be rented to another company at an annual rental of $108.000 However. Hon Products has determined that 30% of the fixed overhead being applied to parts will be avoided Ir part 6 purchased from the outside supplier Required: 1. What is the net dolor advantage or disadvantage of accepting the outside supplier's offer? (Round "Total costs and final answer to the nearest whole dollar amount.) 2. What is the annual rental value at which the company will be indifferent between the two options? (Round "Total costs and final answer to the nearest whole dollar amount.)