A company is planning to introduce a new portable computer to its existing product line.Management must decide whether to make the computer case or buy it from an outside supplier.The lowest outside price is $90.If the case is produced internally,the company will have to purchase new equipment that will yield annual depreciation of $130,000.The company will also need to rent a new production facility at $200,000 a year.At 20,000 cases per year,a preliminary analysis of production costs shows the following:
Required:
(1)Determine whether the company should make the cases or buy them from the outside supplier.
(2)What other factors,besides cost,should the company consider?
Definitions:
General Sense
Pertains to the basic or common understanding of a concept or perception applicable across different contexts.
Taste
is one of the five senses, involving the perception of flavor from substances on the tongue, mediated by taste buds.
General Sense
Refers to the basic or overall understanding and perception of a topic or issue without delving into specific details.
Touch
A sensation perceived through the skin's receptors that involves the detection of pressure, temperature, and pain.
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