Finefurniture Ltd Has the Opportunity to Purchase Componentry in Sufficient

question 31

Multiple Choice

Finefurniture Ltd has the opportunity to purchase componentry in sufficient quantities at $5.50 per chair. Currently Finefurniture Ltd makes the components for 7000 chairs at the following costs: A saving of 20% of fixed overhead would occur if the components were bought. Should the component be bought, and why?

• A) No, increased cost of $0.36 per chair.
• B) No, increased cost of $1.50 per chair.
• C) Yes, cost savings of $1 per chair.
• D) Yes, cost savings of $0.50 per chair.

---

Definitions:

Membrane-bound Receptor Model

A concept describing receptors located on the cell membrane that bind to specific molecules outside the cell, initiating a cellular response.

Nuclear Receptor

A class of proteins within cells that are responsible for sensing steroid and thyroid hormones and other molecules.

mRNA Synthesis

A process where a messenger RNA (mRNA) strand is created from a DNA template, which serves as a guide for protein synthesis in cells.

Lipid Synthesis

Lipid synthesis is the biochemical process by which cells produce lipids, which are fats and oils crucial for cell structure, energy storage, and signaling.