Mighty Safe Fire Alarm is currently buying 50,000 motherboard from MotherBoard's Inc at a price of $65 per board. It was suggested at the last manager's meeting that the company should consider making its own boards. The costs to make the part are as follows: Direct Materials $32 per unit, Direct labor $10 per unit, Variable Factory Overhead $16.00, Fixed Costs for the plant would increase by
$75,000. As the financial advisor, what would you recommend?
A) Buy - $75,000 more in profits
B) Make - $275,000 increase in profits
C) Buy - $275,000 more in profits
D) Make - $350,000 increase in profits
B
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