Glberto Company currently manufactures 78,000 units per year of one of its crucial parts. Varlable costs are $2.60 per unit, fixed costs related to making this part are $88,000 per year, and allocated fixed costs are $75,000 per year. Allocated fixed costs are unavoidable whether the company makes or buys the part. Glberto Is consldering buying the part from a supplier for a quoted price of $3.80 per unit guaranteed for a three-year perlod. Calculate the total Incremental cost of making 78,000 and buylng 78,000 units. Should the company continue to manufacture the part, or should It buy the part from the outside suppller? Complete this question by entering your answers in the tabs below. Costs to Make Costs to Buy Outside Supplier Calculate the total incremental cost of making 78,000 units. (Round cost per unit answers to 2 decimal places.) Incremental Costs to Make Relevant Amount per Relevant Fixed Costs Total Relevant Unit Costs Variable cost per unit Fixed manufacturing costs Total incremental cost to make < Costs to Make Costs to Buy >

Glberto Company currently manufactures 78,000 units per year of one of its crucial parts. Varlable costs are $2.60 per unit, fixed costs related to making this part are $88,000 per year, and allocated fixed costs are $75,000 per year. Allocated fixed costs are unavoidable whether the company makes or buys the part. Glberto Is consldering buying the part from a supplier for a quoted price of $3.80 per unit guaranteed for a three-year perlod. Calculate the total Incremental cost of making 78,000 and buylng 78,000 units. Should the company continue to manufacture the part, or should It buy the part from the outside suppller? Complete this question by entering your answers in the tabs below. Costs to Make Costs to Buy Outside Supplier Calculate the total incremental cost of making 78,000 units. (Round cost per unit answers to 2 decimal places.) Incremental Costs to Make Relevant Amount per Relevant Fixed Costs Total Relevant Unit Costs Variable cost per unit Fixed manufacturing costs Total incremental cost to make < Costs to Make Costs to Buy >

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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