# What is the difference between buying and making?

What is the difference between buying and making?

Ellen currently makes part y-7 which is used to make a lawnmower they manufacture and sell. Following are the costs to make the product. They use 10,000 parts a year.Direct Material \$12
Direct Labor 18
Variable Overhead 6Fixed Overhead is \$80,000Of the \$80,000, \$50,000 is avoidable if we buy the part. Also, we can rent the area used to make the part for \$25,000. The part can be bought for \$40 and will meet our quality requirements. What is the difference between buying and making?We have,
Parts used=10,000
Parts made (y)=10,000+7=10,007Cost to make the product:
Variable cost:
Direct material=\$12*10,007=\$120,084
Direct …The solution discusses the cost of making the product, accounting for the material and labor, in comparison to the cost of making the product.

What is the difference between buying and making?

Ellen currently makes part y-7 which is used to make a lawnmower they manufacture and sell. Following are the costs to make the product. They use 10,000 parts a year.Direct Material \$12
Direct Labor 18
Variable Overhead 6Fixed Overhead is \$80,000Of the \$80,000, \$50,000 is avoidable if we buy the part. Also, we can rent the area used to make the part for \$25,000. The part can be bought for \$40 and will meet our quality requirements. What is the difference between buying and making?We have,
Parts used=10,000
Parts made (y)=10,000+7=10,007Cost to make the product:
Variable cost:
Direct material=\$12*10,007=\$120,084
Direct …The solution discusses the cost of making the product, accounting for the material and labor, in comparison to the cost of making the product.

What is the difference between buying and making?

Ellen currently makes part y-7 which is used to make a lawnmower they manufacture and sell. Following are the costs to make the product. They use 10,000 parts a year.Direct Material \$12
Direct Labor 18
Variable Overhead 6Fixed Overhead is \$80,000Of the \$80,000, \$50,000 is avoidable if we buy the part. Also, we can rent the area used to make the part for \$25,000. The part can be bought for \$40 and will meet our quality requirements. What is the difference between buying and making?We have,
Parts used=10,000
Parts made (y)=10,000+7=10,007Cost to make the product:
Variable cost:
Direct material=\$12*10,007=\$120,084
Direct …The solution discusses the cost of making the product, accounting for the material and labor, in comparison to the cost of making the product.

What is the difference between buying and making?

Ellen currently makes part y-7 which is used to make a lawnmower they manufacture and sell. Following are the costs to make the product. They use 10,000 parts a year.Direct Material \$12
Direct Labor 18
Variable Overhead 6Fixed Overhead is \$80,000Of the \$80,000, \$50,000 is avoidable if we buy the part. Also, we can rent the area used to make the part for \$25,000. The part can be bought for \$40 and will meet our quality requirements. What is the difference between buying and making?We have,
Parts used=10,000
Parts made (y)=10,000+7=10,007Cost to make the product:
Variable cost:
Direct material=\$12*10,007=\$120,084
Direct …The solution discusses the cost of making the product, accounting for the material and labor, in comparison to the cost of making the product.

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