In make-or-buy decisions for a part for a product,relevant costs include ________.
A) some variable costs of making the part
B) all variable costs of making the part
C) fixed costs that can be avoided in the future if the part is purchased
D) B and C

Question

Quizplus · Accepted Answer

Relevant costs in make-or-buy decisions include some variable costs of making the part (Option A) and all fixed costs that can be avoided in the future if the part is purchased (Option C). Therefore, the best choice is D, which includes both options A and C. It is important to consider both the variable and fixed costs in order to make an informed decision on whether to make or buy the part.

In Make-Or-Buy Decisions for a Part for a Product,relevant Costs