Answer the following questions using the information below:
Qamar Corporation produces a part that is used in the manufacture of one of its products. The costs associated with the production of 10,000 units of this part are as follows:

-RAIS Company has offered to sell 10,000 units of the same part to Qamar Corporation for $36 per unit. Assuming there is no other use for the facilities, Qamar should:
A) make the part, as this would save $2 per unit
B) buy the part, as this would save the company $60,000
C) buy the part, as this would save $6 per unit
D) make the part, as this would save $6 per unit

Question

Answer the following questions using the information below:
Qamar Corporation produces a part that is used in the manufacture of one of its products. The costs associated with the production of 10,000 units of this part are as follows:

-RAIS Company has offered to sell 10,000 units of the same part to Qamar Corporation for $36 per unit. Assuming there is no other use for the facilities, Qamar should:
A) make the part, as this would save $2 per unit 
B) buy the part, as this would save the company $60,000 
C) buy the part, as this would save $6 per unit 
D) make the part, as this would save $6 per unit

Quizplus · Accepted Answer

If Qamar Corporation makes the part, it costs $34 per unit. Buying it for $36 per unit would not save money, so making the part saves $2 per unit.

Answer the Following Questions Using the Information Below