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Waterway Company has contacted Pharoah Inc. with an offer to sell it 6500 of the wickets for $17.00 each. If Pharoah makes the wickets, variable
Waterway Company has contacted Pharoah Inc. with an offer to sell it 6500 of the wickets for $17.00 each. If Pharoah makes the wickets, variable costs are $11 per unit. Fixed costs are $12 per unit however $4 per unit is avoidable. Should Pharoah make or buy the wickets? What are the savings of this choice?
Buy; savings = $26000
Buy; savings = $13000
Make; savings = $26000
Make; savings = $13000
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