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Daily Kneads, Inc., is thinking about having one of its products made by a supplier. The supplier will charge $6,000 for 1,000 units. Currently, Daily
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Daily Kneads, Inc., is thinking about having one of its products made by a supplier. The supplier will charge $6,000 for 1,000 units. Currently, Daily Kneads' costs to make 1,000 units of this product are as follows:
Cost per unit
Cost of 1,000 units
Direct labor $4
$4,000
Direct materials $1
$1,000
Allocated Unavoidable Fixed Costs $2
$2,000
Total costs $7
$7,000
Calculate the relevant incremental cost of making each unit: $Blank 1 per unit
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