Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Rubium Micro Devices currently manufactures a subassembly for its main product. The costs per unit are as follows: Direct materials Direct labor $51.00 35.00 Variable
Rubium Micro Devices currently manufactures a subassembly for its main product. The costs per unit are as follows: Direct materials Direct labor $51.00 35.00 Variable overhead 38.00 Fixed overhead Total 31.00 $155.00 Crayola Technologies Inc. has contacted Rubium with an offer to sell 10,000 of the subassemblies for $140.00 each. Rubium will eliminate $93,000 of fixed overhead if it accepts the proposal. Should Rubium make or buy the subassemblies? What is the difference between the two alternatives? A. Make; savings = $243,000 B. Buy; savings = $107,000 C. Buy; savings = $93,000 D. Make; savings = $67,000
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started