Gilberto Company currently manufactures 88,000 units per year.docx - Gilberto Company currently manufactures 88,000 units per year of one of is crucial

# Gilberto Company currently manufactures 88,000 units per year.docx

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Gilberto Company currently manufactures 88,000 units per year of one of is crucial parts. Variable costs are \$3.10 per unit, fed costs related to making this part are \$98.000 per year, and alocated food costs are \$85,000 per year. Allocated foxed costs are unavoidable whether the company makes or buys the part Gilberto is considering buying the part from a supplier for a quoted price of \$4.30 per unft guaranteed for a three-year period. Calculate the total incremental cost of making 88,000 and buying 88.000 units. Should the company continue to manufacture the part, or should it buy the part from the outside supplier? Answer is not complete. Complete this question by entering your answers in the tabs below.

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Unformatted text preview: Costs to Make Costs to Buy Outside Supplier Calculate the total incremental cost of making 88.000 units. (Round cost per unit answers to 2 decimal places) Incremental Costs to Make Relevant Amount Total Relevant Fixed per Unit Relevant Costs Variable cost per unit 3.10 272000 Fixed manufacturing costs 08.000 98.000 00 370,000 Total incremental Emak Costs to Buy &gt; Costs to Make Costs to Buy Outside Supplier Calculate the total increrlashtal cost of buying 88.000 units. (Round cost per unit answers to 2 decimal places.) Incremental Costs to Buy Relevant Amount Relevant Fixed Total Relevant per Unit Gosts Total incremental cost to buy &lt; Costs to litake Outside Supplier &gt;...
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