Exercise 23-1 (Algo) Make or buy LO P1 Beto Company pays $5.70 per unit to buy a part for one of the products it manufactures. With excess capacity, the company is considering making the part. Making the part would cost $6.00 per unit for direct materials and $1.00 per unit for direct labor. The company normally applies overhead at the predetermined rate of 200% of direct labor cost. Incremental overhead to make the part would be 80% of direct labor

Exercise 23-1 (Algo) Make or buy LO P1 Beto Company pays $5.70 per unit to buy a part for one of the products it manufactures. With excess capacity, the company is considering making the part. Making the part would cost $6.00 per unit for direct materials and $1.00 per unit for direct labor. The company normally applies overhead at the predetermined rate of 200% of direct labor cost. Incremental overhead to make the part would be 80% of direct labor cost. (a) Prepare a make or buy analysis of costs for this part. (Enter your answers rounded to 2 decimal places.) (b) Should Beto make or buy the part