In make-or-buy analysis, which of the following is not a key input to the decision?
A) avoidable fixed costs
B) avoidable variable costs
C) cost by the contract manufacturer
D) the sales price of the product being manufactured

Question

Quizplus · Accepted Answer

The sales price of the product being manufactured is not a key input in make-or-buy analysis. This analysis focuses on the costs associated with making a product in-house versus the costs of buying it from an external supplier, including avoidable fixed and variable costs, and the cost by the contract manufacturer. The sales price is related to revenue, not the cost decision process.

In Make-Or-Buy Analysis, Which of the Following Is Not a Key