Tirzah Febiola C - D1121056

No. 1
Purchase outside the company= 10.000 units x $150= $ 1,500,000
(-) Savings of B's Variable cost= 10.000 units x $140= $ 1,400,000
Net cost or benefit to buy outside $ 100,000
The company will not benefit if division A purchase outside the company
Because purchase from outside the company is $100,000 more expensive
No. 2
Purchase outside the company= 10.000 units x $150= $ 1,500,000
(-) Savings of B's Variable cost= 10.000 units x $140= $ 1,400,000
(-) Savings of B's Fix cost if does not manufacture the material for division A= $ 200,000
Net cost or benefit to buy outside $ (100,000)
Saving division B is more larger $100.000 if division A purchase outside the company.
Therefore, division A should purchase from outside which is benefecial for the company.

No. 3
Purchase outside the company= ($150-$20) x 10.000 units = $ 1,300,000
(-) Savings of B's Variable cost= 10.000 units x $140= $ 1,400,000
Net cost or benefit to buy outside $ (100,000)
Division A should buy from outside because purchase outside is more benefecial $100.000