The Tufanzi Furniture Company manufactures leather furniture. The manufacturing process uses a variety of metal...
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Accounting
The Tufanzi Furniture Company manufactures leather furniture. The manufacturing process uses a variety of metal pieces, such as brackets, braces, and casters. Carla Reid, the resource officer of Tufanzi, has been asked to determine whether it is advisable to purchase these pieces rather than make them internally (the current practice). Identify the following items as relevant or irrelevant to her decision by placing a "X" in the appropriate column.
Items Relevant Irrelevant
a.The original cost of equipment currently used to
make metal pieces.
b.The market value of equipment currently used to
make metal pieces.
c.The cost of buying metal pieces from suppliers.
d.The space freed up if metal pieces are not made internally.
e.The salary of the president of Tufanzi Furniture.
f.The quality of the metal pieces made internally.
g.The quality of the metal pieces purchased from suppliers.
h.Depreciation on equipment used to make metal pieces (ignore taxes).
i.The labor rate for production workers who make metal pieces.
j.The selling prices of furniture pieces.
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