Chapter 8, Lecture 2-students

Chapter 8, Lecture 2-students - Chapter8, Part2 oftheRoom...

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Chapter 8, Short-term Decision Making,  Part 2 Please Pick Up Handout in the Back  of the Room
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Copyright © 2010, School of Accountancy, Arizona State University Make or Buy Decisions (Outsourcing) Should a product be produced internally, or purchased from an external supplier? Is the supplier’s sales price less than our cost? Wil l we lose control over quality and delivery if we use an outside suppl ier? Will an external supp li er have more experience tha n we have?
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Copyright © 2010, School of Accountancy, Arizona State University The Make or Buy Decision (Outsourcing) -  Example Laura manufactures part 777A that is currently used in one of its products. The unit cost to make this part is: Direct materials $ 9 Direct labor 5 Variable overhead 1 Depreciation of special equip. 3 Supervisor's salary 2 General factory overhead 10 Total cost per unit 30 $
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Copyright © 2010, School of Accountancy, Arizona State University The Make or Buy Decision-Outsourcing
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