Birch Company manufactures a part for its production cycle.The costs per unit for 5,000 units of the part are as follows: The fixed factory overhead costs are unavoidable.Spalding Company has offered to sell 5,000 units of the same part to Birch Company for $15 per unit.Assuming no other use for the facilities,Birch Company should ________.
A)make the part to save $1 per unit
B)make the part to save $3 per unit
C)buy the part from Spalding Company to save $1 per unit
D)buy the part from Spalding Company to save $3 per unit

Question

Birch Company manufactures a part for its production cycle.The costs per unit for 5,000 units of the part are as follows:  The fixed factory overhead costs are unavoidable.Spalding Company has offered to sell 5,000 units of the same part to Birch Company for $15 per unit.Assuming no other use for the facilities,Birch Company should ________.
A)make the part to save $1 per unit 
B)make the part to save $3 per unit 
C)buy the part from Spalding Company to save $1 per unit 
D)buy the part from Spalding Company to save $3 per unit

Quizplus · Accepted Answer

The Answer of Birch Company manufactures a part for its production cycle.The costs per unit for 5,000 units of the part are as follows:  The fixed factory overhead costs are unavoidable.Spalding Company has offered to sell 5,000 units of the same part to Birch Company for $15 per unit.Assuming no other use for the facilities,Birch Company should ________.
A)make the part to save $1 per unit 
B)make the part to save $3 per unit 
C)buy the part from Spalding Company to save $1 per unit 
D)buy the part from Spalding Company to save $3 per unit

Birch Company Manufactures a Part for Its Production Cycle