Respuesta :
Answer:
The net benefit is $5,000.
Explanation:
A division of Hewlett-Packard currently makes 8,000 circuit boards per year.
The cost of making a board is $33, consisting of variable costs per unit of $26 and fixed costs per unit of $7.
Sanmina Corporation offers to sell Hewlett-Packard the 8,000 circuit boards for $33 each.
If Hewlett-Packard accepts this offer, the facilities currently used to make the boards could be rented to one of Hewlett-Packard's suppliers for $29,000 per year.
In addition, $3 per unit of the fixed overhead applied to the circuit boards would be totally eliminated.
The total cost of manufacturing 8,000 circuit boards
= [tex]8,000\ \times\ \$ 33[/tex]
= $2,64,000
Total purchase price
= [tex]8,000\ \times\ \$ 33[/tex]
= $2,64,000
Fixed overhead cost applied
= [tex]8,000\ \times\ \$ 3[/tex]
= $24,000
The rental income is $29,000.
Outsourcing cost
= Total purchase price + Fixed overhead cost applied - rental income
= $2,64,000 + $24,000 - $29,000
= $2,59,000
Net benefit
= Total cost of manufacturing - Outsourcing cost
= $2,64,000 - $2,59,000
= $5,000
