Unit cost for business


A business is operating at 90% of capacity and is currently buying a part employed in its manufacturing operations for $17.00 per unit. The unit cost for business to make the part is $21.00, comprising fixed costs, and $9.00, not including fixed costs. If 31,732 units of the part are normally purchased during the year but could be manufactured using unused capacity, determine the amount of differential cost increase or decrease from making the part rather than purchasing it. Select the correct answer.

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Mathematics: Unit cost for business
Reference No:- TGS0873062

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