Exercise 13-11 (Algo) Make or Buy Decision [LO13-3] Han Products manufactures 32,000 units of part...
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Exercise 13-11 (Algo) Make or Buy Decision [LO13-3] Han Products manufactures 32,000 units of part S.6 each year for use on its production line. At this level of activity, the cost per unit for part S.6 is: An outside supplier has offered to sell 32,000 units of part S.6 each year to Han Products for $19 per part. If Han Products accepts this offer, the facilities now being used to manufacture part $6 could be rented to another company at an annual rental of $82,000. However, Han Products has determined that two-thirds of the fixed manufacturing overhead being applied to part S-6 would continue even if part S-6 were purchased from the outside supplier. Required: What is the financial advantage (disadvantage) of accepting the outside supplier's offer
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