Circumstances of Case Study Assignment

Circumstances of Case Study Assignment
Please describe the circumstances of the following case study and recommend a course of action. Explain your approach to the problem, perform relevant calculations and analysis, and formulate a recommendation. Ensure your work and recommendation are thoroughly supported.
Case Study:

A vacuum manufacturer has prepared the following cost data for manufacturing one of its engine components based on the annual production of 50,000 units.

DescriptionCost per MonthDirect Materials $75,000Direct Labor$100,000Total$175,000

In addition, variable factory overhead is applied at $7.50 per unit. Fixed factory overhead is applied at 150% of direct labor cost per unit. The vacuums sell for $150 each. A third party has offered to make the engines for $60 per unit. 75% of fixed factory overhead, which represents executive salaries, rent, depreciation, and taxes, continue regardless of the decision. Should the company make or buy the engines?

Superior papers will:

Perform all calculations correctly.
Articulate the approach to solving the problem, including which financial information is relevant and not relevant.
Correctly conclude on whether the company should make or buy the engines.
Propose other factors that should be considered when making this decision and elaborate on whether or not those factors do or do not support the decision.

Grading Rubric for Writing Assignment

Your professor may use a slightly different rubric, but the standard rubric at AUR will assess your writing according to the following standards:



  A (4) B (3) C (2) D/F (1/0)
Focus: Purpose Purpose is clear Shows awareness of purpose Shows limited awareness of purpose No awareness
Main idea Clearly presents a There is a main idea Vague sense of a No main idea
  main idea and supported throughout main idea, weakly  
  supports it most of the paper. supported  
  throughout the   throughout the  
  paper.   paper.  
Organization: Well-planned and Good overall There is a sense of No sense of
Overall well-thought out. organization, includes organization, organization
  Includes title, the main although some of the  
  introduction, organizational tools. organizational tools  
  statement of main   are used weakly or  
  idea, transitions and   Missing  
Organization: All paragraphs have Most paragraphs have Some paragraphs Para. lack clear ideas
Paragraphs clear ideas, are clear ideas, are have clear ideas,  
  supported with supported with some support from  
  examples and have examples and have examples may be  
  smooth transitions. transitions. missing and  
      transitions are weak.  
Content Exceptionally well- Well-presented and Content is sound and Content is not sound
  presented and argued; ideas are solid; ideas are  
  argued; ideas are detailed, developed present but not  
  detailed, well- and supported with particularly  
  developed, evidence and details, developed or  
  supported with mostly specific. supported; some  
  specific evidence &   evidence, but  
  facts, as well as   usually of a  
  examples and   generalized nature.  
  specific details.      
Research (if Sources are Sources are well Sources support The paper does not
assignment exceptionally well- integrated and some claims made in use adequate
includes a integrated and they support the paper’s the paper, but might research or if it does,
research support claims claims. There may be not be integrated the sources are not
component) argued in the paper occasional errors, but well within the integrated well.
  very effectively. the sources and paper’s argument. They are not cited
  Quotations and Works Cited conform There may be a few correctly according
  Works Cited to MLA style sheet. errors in MLA to MLA style, nor
  conform to MLA   style.. listed correctly on
  style sheet.     the Works Cited
Style: Sentence Sentences are clear Sentences are clear Sentences are Sentences aren’t
structure and varied in but may lack generally clear but clear
  pattern, from simple variation; a few may may have awkward  
  to complex, with be awkward and there structure or unclear  
  excellent use of may be a few content; there may  
  punctuation. punctuation errors. be patterns of  

Circumstances of Case Study Assignment

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