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Han Products manufactures 25,000 units of part S-6 each...

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Han Products manufactures 25,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per part S 5.00 8.00 2.60 12.00 S 27.60 An outside supplier has offered to sell 25,000 units of part S-6 each year to Han Products for $42.00 per part. If Han Products accepts this offer, the facilities now being used to manufacture part S-6 could be rented to another company at an annual rental of $551,000. However, Han Products has determined that two-thirds of the fixed manufacturing overhead being applied to part S-6 would continue even if part S-6 were purchased from the outside supplier Required 1. Calculate the per unit and total relevant cost for buying and making the product. (Round your "per unit" answers to 2 decimal places.) Unit 25,000 Units Cost of purchasing Cost of making: Direct materials Direct labor Variable overhead Fixed overhead Total cost 0.00 S 2. How much will profits increase or decrease if the outside supplier's offer is accepted

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