First Line Safety Pty Ltd manufactures fire extinguishers. One part used in all types of fire extinguishers in a unique pressure fitting, requiring specialized machine tools that now need to be replaced. First line production has concluded that the only alternative to replacing these machine tools is to buy the pressure fitting from Lonsdale pipe and fitting company. First line could buy the fittings of $20 if a minimum order of 70000 fittings were placed annually. First line has used an annual average of 80000 fittings over the past three years. The production manager believes that this volume will remain constant for five more years. Cost records indicate that unit manufacturing costs for the last several years have been as follows:Direct material
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After -tax cash flows; NPV: manufacturer First Line Safety Pty Ltd manufactures fire extinguishers. One part used in all types of fire extinguishers… was first posted on October 8, 2020 at 4:55 am.
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After -tax cash flows; NPV: manufacturer First Line Safety Pty Ltd manufactures fire extinguishers. One part used in all types of fire extinguishers… was first posted on October 8, 2020 at 5:21 am.
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