(a) Calculate the relevant cost to make. Relevant cost to make $_________ per unit (b) Should Outland continue to manufacture the part? yes or no
(a) Calculate the relevant cost to make. Relevant cost to make $_________ per unit (b) Should Outland continue to manufacture the part? yes or no The Outland Company manufactures 5,000 units of a part that could be purchased from an outside supplier for $16 each. Outland’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.
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