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1.

Tanner Company currently pays $14 per unit to buy a part for a product it manufactures. instead. Tanner could make the partfor per unit cons of $6 for direct materials, $4 for direct labor. and $2 for incremental overhead. Tanner normally applies overhead costs using a predetermined rate of20096: of drrec1 labor cost. Should Tanner make or buy the part? Multiple Choke 0 Make the part as the cost to make it is $4 less than the cosl to buy it. Buy the pan as the cost to Buy It is $2 less than the costto make it Buy the pan as the Cast to buy it is $8 less than the (051 to make it Make the part as the cost to make it is $2 less than the cost to buy It. 0000 Buy the pan as the Cast to buy rt is 194 less than the East to make lL Incremental costs are the additional costs from selecting a certain course of action. True or False True False Joybird Company operates in a highly competitive market where the markel price lor lIS product is $95 per Unit Jaybird desires o 30% profit per unit Jaybird expects to sell 5,000 units, Additional Information is as follows: Variable Costs per Unit Fixed Costs (total) Direct materials $ 14 overhead 5 45,668 Direct labor is General and administrative 18,668 Overhead 13 General and administrative 19 To achieve meiargel cos] per unn, Jaybird mum reduce iotal expenses by how much? Multiple Chulce O $45500 $37 000 $35 500 $26.0 00 $41500 0000 A sunk cost can be changed depending on The results of future decisions. True or False