21 Dec Effects of the level of production on an outsourci
Effects of the level of production on an outsourcing decisionOne of Eby Company’s major products is a fuel additive designed to improve fuel efficiency and keep engines clean. Eby, a petrochemical firm, makes and sells 100,000 units of the fuel additive per year. Its management is evaluating the possibility of having an outside supplier manufacture the product for Eby for $2 each. Eby would continue to sell and distribute the fuel additive under its own brand name for either alternative. Eby’s accountant constructed the following profitability analysis.Revenue (100,000 units × $3.50)$350,000Unit-level materials costs (100,000 units × $0.80)(80,000)Unit-level labor costs (100,000 units × $0.12)(12,000)Unit-level overhead costs (100,000 × $0.38)(38,000)Unit-level selling expenses (100,000 × $0.20)(20,000)Contribution margin200,000Fuel additive production supervisor’s salary(80,000)Allocated portion of facility-level costs(20,000)Product-level advertising cost(40,000)Contribution to companywide income$ 60,000
Our website has a team of professional writers who can help you write any of your homework. They will write your papers from scratch. We also have a team of editors just to make sure all papers are of HIGH QUALITY & PLAGIARISM FREE. To make an Order you only need to click Ask A Question and we will direct you to our Order Page at WriteDemy. Then fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Fill in all the assignment paper details that are required in the order form with the standard information being the page count, deadline, academic level and type of paper. It is advisable to have this information at hand so that you can quickly fill in the necessary information needed in the form for the essay writer to be immediately assigned to your writing project. Make payment for the custom essay order to enable us to assign a suitable writer to your order. Payments are made through Paypal on a secured billing page. Finally, sit back and relax.
About Writedemy
We are a professional paper writing website. If you have searched a question and bumped into our website just know you are in the right place to get help in your coursework. We offer HIGH QUALITY & PLAGIARISM FREE Papers.
How It Works
To make an Order you only need to click on “Order Now” and we will direct you to our Order Page. Fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Are there Discounts?
All new clients are eligible for 20% off in their first Order. Our payment method is safe and secure.