Freeman electronics currently produces the shipping


Freeman Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,300 containers follows. Unit-level materials $ 6,200 Unit-level labor 6,700 Unit-level overhead 3,800 Product-level costs* 7,200 Allocated facility-level costs 27,000 *One-third of these costs can be avoided by purchasing the containers. Baxi Container Company has offered to sell comparable containers to Freeman for $2.50 each. PLEASE SHOW WORK!

Required a-1. Calculate the total relevant cost.

a-2. Should Freeman continue to make the containers? Yes correct

b-1. Freeman could lease the space it currently uses in the manufacturing process.

If leasing would produce $12,700 per month, Calculate the total avoidable costs.

b-2. Should Freeman continue to make the containers?

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Financial Accounting: Freeman electronics currently produces the shipping
Reference No:- TGS01596524

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