Part B Megasonic Ltd currently design and manufacture their own range of high-de

Question

Part B Megasonic Ltd currently design and manufacture their own range of high-definition DVD recorders. The cost details for their latest range are shown below Direct Materials m $1,600,000 $500,000 $650,000 voH Direct Labour Variable Overhead voh Fixed Overhead o. Total Manufacturing Cost For $950,000 , $3,700,000 5,000 units $740 Quantity Produced Cost Per Unit An overseas manufacturer has offered to supply a similar range of high-definition DVD recorders for $700 per unit. Required [11 Should Megasonic Ltd make or buy their range of high-definition DVR recorders? Show all calculations 121 What other factors should be taken into considerationpvi recorder Units to hoke the. 13+3 6 marks ] 174

Explanation / Answer

The following are the factors that should be taken into considerations:

1. Skills and experience

2.  Quality of output

3. Control over supply and delivery,etc

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