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Rubium Micro Devices currently manufactures a subassembly for its main product. The costs per unit are as follows: $52 37 Direct materials Direct labor Variable
Rubium Micro Devices currently manufactures a subassembly for its main product. The costs per unit are as follows: $52 37 Direct materials Direct labor Variable overhead Fixed overhead Total costs 36 40 $165 Crayola Technologies Inc. has contacted Rubium with an offer to sell 8,000 of the subassemblies for $145 each. Rubium will eliminate $85,000 of fixed overhead if it accepts the proposal. Should Rubium make or buy the subassemblies? What is the difference between the two alternatives? O A. Buy; savings = $85,000 O B. Make; savings = $75,000 O C. Make; savings = $245,000 OD. Buy; savings = $51,000
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