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Question

Given the following data, determine the total annual cost of making with each of process A and B and of buying.

Estimated demand is 9,500 units a year. Which alternative is best?

 

 Make 

 Process A  Process B      Buy  

 Variable cost per unit$ 47  $50  $49        

Annual fixed cost $40,000  $33,000    

 Transportation cost per unit       $4 

Top Answer

The costs for making process A Variable costs = $47 * 9,500= $446,500 Add annual fixed costs = ......$40,000 Total... View the full answer

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