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20.3 Make or Buy MB Co. manufactures electric toothbrushes. Each toothbrush requires a small motor, Part M4. MB is currently manufacturing the motor, but another
20.3 Make or Buy MB Co. manufactures electric toothbrushes. Each toothbrush requires a small motor, Part M4. MB is currently manufacturing the motor, but another company, RW, has offered to supply it for $11 per unit. Each motor requires $2.00 of direct material, $4.00 of direct labor, $3.00 of variable manufacturing overhead, and $1.50 fixed manufacturing overhead. If MB accepts RW's offer, all fixed manufacturing overhead costs will continue. Calculate the maximum price MB should be willing to pay. O $15.75 $11.00 $10.50 O $9.00
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