Epsilon Co. can produce a unit of product for the following costs:

Direct material$8Direct labor24Overhead40Total costs per unit$72

An outside supplier offers to provide Epsilon with all the units it needs at $60 per unit. If Epsilon buys from the supplier, the company will still incur 40% of its overhead. Epsilon should choose to:

Multiple Choice

• Buy since the relevant cost to make it is $72.
• Make since the relevant cost to make it is $56.
• Buy since the relevant cost to make it is $48.
• Make since the relevant cost to make it is $48.
• Buy since the relevant cost to make it is $56.