North Central Publishing is considering outsourcing its printing process. Which of the following are relevant for this outsourcing decision?
I The rent associated with the freed-up space when the printing equipment is sold
Ii Supplier's financial stability
Iii The carrying amount of the printing equipment

Question

Quizplus · Accepted Answer

I - The rent associated with the freed-up space when the printing equipment is sold is relevant to the decision as it represents a potential cost savings or opportunity for revenue generation.

II - The supplier's financial stability is relevant to the decision as it will impact the reliability and long-term viability of the outsourcing arrangement.

III - The carrying amount of the printing equipment is less relevant to the outsourcing decision as it is a sunk cost and should not impact the decision to outsource. However, it may be relevant in terms of the potential proceeds from selling the equipment.

North Central Publishing Is Considering Outsourcing Its Printing Process