Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Gilberto Company currently manufactures 50,000units per year of one of its crucial parts. Variable costs are $2.50 per unit, fixed costs related to making this

image text in transcribed

Gilberto Company currently manufactures 50,000units per year of one of its crucial parts. Variable costs are $2.50 per unit, fixed costs related to making this part are $50,000 per year, and allocated fixed costs are $50,000 per year. Allocated fixed costs are unavoidable whether the company makes or buys the part. Gilberto is considering buying the part from a supplier for a quoted price of $3.70 per unit guaranteed for a three-year period Calculate the total incremental cost of making 50,000 units. (Round cost per unit answers to 2 decimal places.) Incremental Costs to Make Relevant Amount per Unit Relevant fixed costs Total relevant costs ariable cost ixed manufacturing costs 50,000$ 50,000 Total incremental cost to make 50,000 Calculate the total incremental cost of buying 50,000 units. (Round cost per unit answers to 2 decimal places.) Incremental Costs to Buy Relevant Amount per Unit Relevant fixed costs Total relevant costs rchase price Total incremental cost to buy

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Study Guide For Financial Accounting

Authors: Walter T. Harrison

8th Edition

0136023347, 978-0136023340

More Books

Students also viewed these Accounting questions