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C. Pewterschmidt manufactures part 4A that is currently used in one of its products. The unit cost to make this part is: Direct Materials $
C. Pewterschmidt manufactures part 4A that is currently used in one of its products. The unit cost to make this part is: Direct Materials $ 10 Direct Labor $ 5 Variable overhead $ 1 Depreciation of special equipment $ 3 Supervisor`s salary $ 3 General factory overhead $ 10 Total cost per unit $ 32 The special equipment used to manufacture part 4A has no resale value. General factory overhead is allocated on the basis of direct labor hours. The 32 total unit cost is based on 20,000 parts produced each year. An outside supplier has offered to provide the 20,000 parts at a cost of 25 per part. Should we make or buy the parts? what is the difference between alternatives? Please choose one: a. $ 500,000, we should buy! b. $ 380,000, we should make! c. $ 760,000, we should buy! D. $ 120,000, we should make
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