Question
TheBridgeportCompany manufactures5,900units of a part that could be purchased from an outside supplier for $16each.Bridgeport's costs to manufacture each part are as follows: Direct materials$4
TheBridgeportCompany manufactures5,900units of a part that could be purchased from an outside supplier for $16each.Bridgeport's costs to manufacture each part are as follows:
Direct materials$4
Direct labor 3
Variable manufacturing overhead 6
Fixed manufacturing overhead 10
Total $23
All fixed overhead is unavoidable and is allocated based on direct labor. The facilities that are used to manufacture the part have no alternative uses.
(a-b)
(a)Calculate relevant cost to make.
Relevent cost to make $ per unit
(b)ShouldBridgeportcontinue to manufacture the part?
Yes
No
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