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Saved Help #7 Submit Save & Exit vork mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question Gibson Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,000 containers follows. Unit-level materials $ 6, 100 Unit-level labor 6,400 Unit-level overhead 3,700 Product-level costs* 7,500 Allocated facility-level costs 27,300 *One-third of these costs can be avoided by purchasing the containers. Russo Container Company has offered to sell comparable containers to Gibson for $2.60 each. Required a. Calculate the total relevant cost. Should Gibson continue to make the containers? b. Gibson could lease the space it currently uses in the manufacturing process. If leasing would produce $11.400 per month, calculate the total avoidable costs. Should Gibson continue to make the containers? Answer is complete but not entirely correct. $ 18,675 a. Total relevant cost Should Gibson continue to make the containers? Total avoidable cost Should Gibson continue to make the containers? Yes $ 23,700 b. No
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