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1 Preparing a Make or Buy Analysis using Excel's SUM, IF and Basic Math Functions Alanco, Inc. manufactures a variety of products and is currently manufacturing all of its own component parts. An outside supplier has offered to sell one of those components to Alanco. The Controller has asked you to help evaluate this offer to determine if the company should make or buy the component. Use the information included in the Excel Simulation and the Excel functions described below to complete the task 25 Doints eBook Pot References Cell References Allows you to refer to data from another cell in the worksheet. From the Excel Simulation below, if in a blank cel-C4" was entered the formula would output the result from cell C4, or 27,000,000 in this example. Basic Math functions Allows you to use the basic math symbols to perform mathematical functions. You can use the following keys: (plus sign to add), minus sign to subtract), "fasterisk sign to multiply), and/tforward slash to divide). From the Excel Simulation below. in a blank cell C14-C15 was entered the formula would add the values from those cells and output the result of 2.900.000 in this example, if using the other math symbols the result would output an appropriate answer for its function functions Allows you to testa condition and return a specific value is the result is true and different value of the result is false. The syntax of the IF function is test_condition value..trevue/Claise and specific considerations need to be made when using this function. The test condition argument is an evaluation of the status of a cell such as if the value of a cellis greater than less than or equal to another number or cell. The value true and values arguments will return any specific result for each option, such as another cell reference. a value, or text. Throughout the entire equation, if text is being used in the test condition value_true or value false arguments then the text itself should be entered in quotations so that Excel will recognize the textos a string of text Instead of another function. From the Excel Simulation below, if in a blank cel FCB1000000,"Net income is goodNet income is bod was entered the formula would output the result of the value_true since the test.condition would be result as true or in the case the text "Net income is good" Excel processes the IF function by separating it out into separate parts. First the test condition Excel thinks And WC8 and determine the value is greater than 1000.000 Once Excel determines if the result of that rest conditionis TRUE FALSE, I will return the value of valuese Absolute Reference: Allows you to maintain the original cell reference when a formula is copied to another cell. The cell reference is Hocked" by putting a dollar sign (3) before the column and row references. By default a cell reference is relative, so when you copy a formula to another cel the values update based on a relative reference. For example, if you copy the formula 08-89 from cell C1 to cell C2, the formula in cell C2 will relatively update to be 89-310 since the copied formuls moved down one cell, the formule cell references also moved down one cell Conversely, by adding the absolute cel reference "locks to the equation, the formula will not change when copied to any other coll. For example, "$0$8-58$9" written in cell is copied to cell C2, the formula in cell 2 will remain$85845859 You can also use a mixed cell reference by only locking the column or row only (8 or 958) which locks that specific column of row and the other reference becomes a relative reference and moves with the formula as its copled to another cell For example, if you copy the formula-058-09" from cell Citocellthe formula in cell C2 wil update to be 358400 since the copied formula moved down one cell the formulace relative references also moved down one cell, but the absolute 'locked reference remained the same. For this project, when using Absolute Cell Referencing you can also use the autot option, however, for proper Grading you should only auto-fill one collate time and not an entire range Saved FILE HOME INSERT PAGE LAYOUT FORMULAS DATA REVIEW VIEW Sign in 1 a la 25 points eBook Print 6 7 Ruler Formula Bar Normal Page Break Page Custom Gridlines Headings Zoom 100% Zoom to Window Macros Preview Layout Views Selection Workbook Views Show Zoom Macros A1 Alanco, Inc. manufactures a variety of products and is currently maunfacturing all B D H 1 1 Alanco, Ing, manufactures a variety of products and is currently maunfacturing all of its own component parts 2 An outside supplier has offered to sell one of those components to Alanco. To evaluate this offer, the following 3 information has been gathered relating to the cost of producing the component internally: 4 5 Direct materials S 4,00 Direct labor 6.00 Variable manufacturing overhead 2.00 Fixed manufacturing overbead, traceable 5.00 Fixed manufacturing overhead, common but allocated 8.00 10 Total cost $ 25.00 11 12 Supplier price $ 21.00 13 14 Units used per year 12.000 15 16 Pixed manufacturing overhead, traceable is composed of two items! 12 Depreciation of equipment (no resale value) 30% 18 Supervisor salary 709 19 20 1. Assuming the company has no alternative use for the facilities now being used to produce the 21 component, complete the following analysis to determine if the outside supplier's offer should be accepted 22 8 9 References 23 Per Unit Differential Com 12/XX units Sheeti READY Altemple) 100% 3 1 wer Formula Bar Nome Page Break Page Custom Gridlines Headings Zoom 100% Zoom to Window Macros Preview Layout Views Selection Workbook Views Show Zoom Macros AL Alanco, Inc. manufactures a variety of products and is currently maunfacturing all 25 points A G - D E F H 18 Supervisor salary 70% 19 20 1. Assuming the company has no alternative use for the facilities now being used to produce the 21 component, complete the following analysis to determine if the outside supplier's offer should be accepted. eBook Print References Per Unit Differential Cost 12,000 units 24 Maker Make By 25 26 Cost of purchasing 27 Direct materials 28 Direct labor 29 Variable manufacturing overhead 10 Hxed manufacturing overhead, traceable 31 Mixed manufacturing overhead, common 32 Total costs 13 Based on this analysis, write an if statement to determine if Alco should make or buy the component 35 V6 Alinco should the component 32 39 40 Sheet1 READY Altemple) 100%

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