3)

Gilberto Company currently manufactures 60,000units per year of one of its crucial parts. Variable costs are $2.10 per unit, fixed costs related to making this part are $60,000 per year, and allocated fixed costs are $45,000 per year. Allocated fixed costs are unavoidable whether the company makes or buys the part. Gilberto is considering buying the part from a supplier for a quoted price of $3.30 per unit guaranteed for a three-year period.

Calculate the total incremental cost of making 60,000 units.(Round cost per unit answers to 2 decimal places.)

Calculate the total incremental cost of buying 60,000 units

Incremental Costs to Make Relevant amount per unit Relevant fixed costs total relevant costs Total Incremental cost to make Calculate the total incremental cost of buying 60,000 units Incremental Costs to buy Relevant Amount per unit relevant fixed costs Total Incremental cost to buy total relevant cost