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Every year Pina Industries manufactures 5,900 units of part 231 for use in its production cycle. The per unit costs of part 231 are
Every year Pina Industries manufactures 5,900 units of part 231 for use in its production cycle. The per unit costs of part 231 are as follows: Direct materials $ 3.00 Direct labor 10.00 Variable manufacturing overhead 6.00 Fixed manufacturing overhead Total 10.00 $29.00 Crane, Inc., has offered to sell 5,900 units of part 231 to Pina for $33 per unit. If Pina accepts Crane's offer, its freed-up facilities could be used to earn $11,300 in contribution margin by manufacturing part 240. In addition, Pina would eliminate 50% of the fixed overhead applied to part 231. (a) Calculate total relevant cost to make and net cost to buy. Total relevant cost to make $ Net relevant cost to buy $
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