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  • LiuMeihan PC#2

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    Meihan
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    The document compares the costs and revenues of manufacturing a product internally versus outsourcing it. It shows that manufacturing internally results in sales of 33,333 units and costs of $2.9 million for a net loss. Outsourcing results in no sales but costs of $3.05 million for an even greater net loss of $149,998. Outsourcing is more expensive despite no sales being generated internally.

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    The document compares the costs and revenues of manufacturing a product internally versus outsourcing it. It shows that manufacturing internally results in sales of 33,333 units and costs of $2.9 million for a net loss. Outsourcing results in no sales but costs of $3.05 million for an even greater net loss of $149,998. Outsourcing is more expensive despite no sales being generated internally.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    49 views1 page

    LiuMeihan PC#2

    Uploaded by

    Meihan
    The document compares the costs and revenues of manufacturing a product internally versus outsourcing it. It shows that manufacturing internally results in sales of 33,333 units and costs of $2.9 million for a net loss. Outsourcing results in no sales but costs of $3.05 million for an even greater net loss of $149,998. Outsourcing is more expensive despite no sales being generated internally.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    of 1

    Manufacture Outsource

    Sale 33,333 -
    Manufacture 100,000 100,000
    Total 133,333 100,000

    Revenue $ 33.00 $ 1,099,989 $ -


    VC 18.80 (2,506,660) 28.00 (2,800,000)
    Fixed overhead 7.20 (959,998) (250,000)
    Divisional costs (533,333) -

    Net cost $ (2,900,002) $ (3,050,000)

    Difference $ (149,998)

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