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Gelb Company currently makes a key part for its main product. Making this part incurs per unit variable costs of $1.60 for direct materials and $1.15 for direct labor. Incremental overhead to make this part is $1.56 per unit. The company can buy the part for $4.54 per unit. (a) Prepare a make or buy analysis of costs for this part. Note: Enter your answers rounded to 2 decimal places. (b) Should Gelb make or buy the

Gelb Company currently makes a key part for its main product. Making this part incurs per unit variable costs of $1.60 for direct materials and $1.15 for direct labor. Incremental overhead to make this part is $1.56 per unit. The company can buy the part for $4.54 per unit. (a) Prepare a make or buy analysis of costs for this part. Note: Enter your answers rounded to 2 decimal places. (b) Should Gelb make or buy the

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Gelb Company currently makes a key part for its main product. Making this part incurs per unit variable costs of $1.60 for direct materials and $1.15 for direct labor. Incremental overhead to make this part is $1.56 per unit. The company can buy the part for $4.54 per unit. (a) Prepare a make or buy analysis of costs for this part. Note: Enter your answers rounded to 2 decimal places. (b) Should Gelb make or buy the
Transcribed Image Text:Gelb Company currently makes a key part for its main product. Making this part incurs per unit variable costs of $1.60 for direct materials and $1.15 for direct labor. Incremental overhead to make this part is $1.56 per unit. The company can buy the part for $4.54 per unit. (a) Prepare a make or buy analysis of costs for this part. Note: Enter your answers rounded to 2 decimal places. (b) Should Gelb make or buy the
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