Relation to the decision to make or buy the component

Reference no: EM13129381

A company is currently making a necessary component in house (the company is producing the component for its own use). The company has received an offer to buy the component from an outside supplier. A machine is being rented to make the component. If the company were to buy the component, the machine would no longer be rented. The rent on the machine, in relation to the decision to make or buy the component, is:

1-sunk and therefore not relevant.

2-avoidable and therefore not relevant.

3-avoidable and therefore relevant.

4-unavoidable and therefore relevant.

Reference no: EM13129381

Questions Cloud

Compute the new cash provided in operating activities : decrease in accounts receivable, a $15,750 increase in accounts payable, and a $12,500 decrease in wages payable. Compute the new cash provided (used) in operating activities using the indirect method

What is the final concentration of naoh : what is the final concentration of NaOH when 50.0 mL of .200 M NaOH is added to 50.0 mL of 0.500 M NaOH?

Allocation to production : If Jones assigns costs to departments based on square footage, how much total costs will be allocated to Production Department 1?

Find certification in accounting or related one in finance : In addition, let me know which one interests you the most and how you would go about preparing to accomplish this great goal. Salary, jobs available, and other related information is what we will be looking for this week.

Relation to the decision to make or buy the component : If the company were to buy the component, the machine would no longer be rented. The rent on the machine, in relation to the decision to make or buy the component, is:

Write down a memo to her advising how she might modify : Write down a memo to her advising how she might modify her current manual accounting system to accomodate the expanded business activities.

Briefly describe what the company did wrong : Please find a real-world example of a company that has been in the news, and briefly describe what the company did wrong. Some ideas for companies include, but are not limited to, Enron, WorldCom, Andersen, Dell, and Xerox.

What is the mass of the second isotope : The atomic weight of a newly discovered element is 98.225 amu. It has two naturally occuring isotopes. One isotope has a mass of 96.780 amu.

What is the company breakeven point in unit sales : Travelers Aids most recent income statement follows Total Per Unit Sales (3,000 units) $90,000 $30.00 Variable expenses $54,000 $18.00 Contribution margin $36,000 $12.00 Fixed Expenses $22,000 Net operating income $14,000.

User Account

All Pages