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Normal Operations

No of units
Revenue
Variable Cost
Direct labor
Direct material
Manufacturing Overhead
Sales

150000
25500

Total Variable Cost


Contribution Margin

1500
6000
1500
1500
0
10500
15000

Fixed Cost
Direct labor
Manufacturing Overhead
Sales
Corporate
Total Fixed Cost
Operating Income

3000
3375
1875
3750
12000
3000

Outsourcing Cost

per 100 units

Insourcing

Outsourcing

100
17

125000+25000
23750

150000+25000
28000

1
4
1
1
0
7
10

1500
6000
1500
1250
0
10250
13500

1500
6000
1500
1500
2000
12500
15500

2
2.25
1.25
2.5
8
2

3000
3375
1875
3750
12000
1500

3000
3375
1875
3750
12000
3500

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