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Quirch Inc. manufactures machine parts for aircraft engines. The ceo, Chucky Valters, was considering an offer from a subcontractor that would provide 2.400 units of
Quirch Inc. manufactures machine parts for aircraft engines. The ceo, Chucky Valters, was considering an offer from a subcontractor that would provide 2.400 units of product PQ107 for Valters for a price of $150,000. 6 Qurch does not purchase these parts from the subcontractor it must produce them in house with the following unit costs: Direct materials Direct labor Variable overhead Cost per Unit $31 20 9 In addition to the above costs, if Quirch produces part P107, it would have a retooling and design cost of $9.900. The relevant costs of producing 2.400 units of product PQ107 internally are: maddition to the above costs, if Quirch produces part P107, it would have a retooling and design cost of $9.900. The relevant costs of producing 2,400 units of product PQ107 internally are: Multiple Choice $153900 $132.300 SD
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