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should best board make or buy the wakeboards under this bid? Best Boards, Inc. produces each wakeboard for $110 each and Jim Muller, vice president
should best board make or buy the wakeboards under this bid?
Best Boards, Inc. produces each wakeboard for $110 each and Jim Muller, vice president of operations, received a bid for $70 per board from an outside manufacturer. The variable production costs are $56 each and the fixed production costs are $540,000 for 10,000 units each year. If the wakeboards were to be purchased, the company would save on variable productions costs and $50,000 on the fixed production costs but all other fixed costs would remain. Should Best Board make or buy the wakeboards under this bid Step by Step Solution
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