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Richard Company makes flanges for its main product of widgets. The cost of making each widget is as follows: Direct Materials: $3.60 Direct Labor: $10.00
Richard Company makes flanges for its main product of widgets. The cost of making each widget is as follows:
Direct Materials: $3.60
Direct Labor: $10.00
Variable Manufacturing Overhead: $2.40
Fixed Manufacturing Overhead: $9.00
Total Cost Per Unit: $25.00
Another company has offered to sell to Richard Company the flanges for a price of $19.00 each. Should Richard Company buy the flanges from the other company or continue to make the flanges themselves?
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