[The following information applies to the questions displayed below.) Redbud Company uses a certain part in its manufacturing process that it buys from an outside supplier for $36 per part plus another $5 for shipping and other purchasing-related costs. The company will need 18,000 of these parts in the next year and is considering making the part internally. After performing a capacity analysis, Redbud determined that it has sufficient unused capacity to manufacture the 18,000 parts but would need to hire a manager at an annual salary of $54,000 to oversee this production activity. Estimated production costs are determined to be as follows: $ 23 Direct material Direct labor Variable overhead Fixed overhead (includes manager at $3 per unit) Total unit cost 00 $ 46 0 a. Identify the relevant costs to make this part internally. (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)
Historical cost unanswered
Direct labor unanswered
Direct material unanswered
Variable overhead unanswered
Fixed overhead unanswered
New manager's salary
b. What are the other factors that Redbud Company should consider in deciding to make the part internally? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)
Total sales quantity. unanswered
The potential for improved control over the availability of the parts by having it when needed and the potential for improved quality of the parts. unanswered
Since Redbud Company is considering the use of currently available capacity, it should evaluate any relevant opportunity costs of using this capacity for more profitable activities.