$ 26,000 Direct labor 28,000 Variable manufacturing overhead 20,000 Fixed manufacturing overhead 45,000 Total costs $ 119,000 An outside supplier has offered to provide Part Y at a price of $ 12 per unit . If Lindon stops producing the part internally , one third of the fixed manufacturing overhead would be eliminated . Required : Prepare a make-or-buy analysis showing the annual advantage or disadvantage of accepting the outside supplier ' s offer . Please state clearly whether the part should be made or bought and share your work .
7 . Question : ( TCO B ) Sandler Corporation bases its predetermined overhead rate on the estimated machine hours for the upcoming year . Data for the upcoming year appear below . Estimated machine hours 75,000 Estimated variable manufacturing overhead $ 4.50 per machine hour Estimated total fixed manufacturing overhead $ 825,000 The actual machine hours for the year turned out to be 77,000 . Required : Compute the company ' s predetermined overhead rate . Set 2