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Han Products manufactures 23,000 units of part S-6 each year for use on its productio line. At this level of activity, the cost per unit
Han Products manufactures 23,000 units of part S-6 each year for use on its productio line. At this level of activity, the cost per unit for part S-6 is: 4.40 6.00 Direct materials Direct labor Variable manufacturing overhead2.90 Fixed manufacturing overhead 12.00 Total cost per part $ 25.30 An outside supplier has offered to sell 23,000 units of part S-6 each year to Han Products for $39.50 per part. f Han Products accepts this offer, the facilities now being used to manufacture part S-6 could be rented to another company at an annual rental of $515,600. However, Han Products has determined that bwo-thirds of the foxed manufacturing overhead being applied to part S-6 would continue even if part S-6 were purchased from the outside supplier. a. Calculate the per unit and total relevant cost for buying and making the product? (Round your Per Unit answers to 2 decimal places.) Per Unit Differential Costs 23,000 Units Make Buy Make Buy Cost of purchasing Cost of making Direct materials Direct labor Variable overhead Fixed overhead Total cost 0.00 S 0.00S FB
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