5. What is the maximum price that Silven should be willing to pay the outside supplier for a box of 24 tubes? 6. Instead of sales of 120,000 boxes of tubes, revised estimates show a sales volume of 149,000 boxes of tubes. At this higher sales volume, Silven would need to rent extra equipment at a cost of $49,000 per year to make the additional 29,000 boxes of tubes. Assuming that the outside supplier will not accept an order for less than 149,000 boxes of tubes, what is the financial advantage (disadvantage) in total (not per box) if Silven buys 149,000 boxes of tubes from the outside supplier? Given this new information, should Silven Industries make or buy the tubes? 7. Refer to the data in (6) above. Assume that the outside supplier will accept an order of any size for the tubes at a price of $2.30 per box. How many boxes of tubes should Silven make? How many boxes of tubes should it buy from the outside supplier?
5. What is the maximum price that Silven should be willing to pay the outside supplier for a box of 24 tubes? 6. Instead of sales of 120,000 boxes of tubes, revised estimates show a sales volume of 149,000 boxes of tubes. At this higher sales volume, Silven would need to rent extra equipment at a cost of $49,000 per year to make the additional 29,000 boxes of tubes. Assuming that the outside supplier will not accept an order for less than 149,000 boxes of tubes, what is the financial advantage (disadvantage) in total (not per box) if Silven buys 149,000 boxes of tubes from the outside supplier? Given this new information, should Silven Industries make or buy the tubes? 7. Refer to the data in (6) above. Assume that the outside supplier will accept an order of any size for the tubes at a price of $2.30 per box. How many boxes of tubes should Silven make? How many boxes of tubes should it buy from the outside supplier?
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter7: Variable Costing For Management
analysis
Section: Chapter Questions
Problem 2PA: The demand for solvent, one of numerous products manufactured by Logan Industries Inc., has dropped...
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