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Return to question 1 5 point Exercise 23-2 (Algo) Make or buy LO P1 Gelb Company currently makes a key part for its main product.
Return to question 1 5 point Exercise 23-2 (Algo) Make or buy LO P1 Gelb Company currently makes a key part for its main product. Making this part incurs per unit variable costs of $1.85 for direct materials and $1.40 for direct lobor. Incremental overheed to make this part is $1.66 per unit. The company can buy the part for $5:19 per unit. (a) Prepare a molte or buy analysis of costs for this part. (Enter your answers rounded to 2 decimal places.) (b) Should Gelb make or buy the part? Answer is complete but not entirely correct. (a) Make or Buy Analysis Make Buy Direct materials 1.20 $ 0.00 Direct labor 0.00 Overhead 1:40 0.00 Cost to buy 0.00 3.50 Cost per unit 5 3.355 3.50 0.75 Cost difference $ 0.15 0 b) Company should Buy
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