Salley Company makes pagers.Currently,Salley purchases 10,000 plastic housings per year from an outside company for $1 each.One of Salley's engineers suggested that the company make its plastic housings in-house.Estimated unit costs are as follows:
* Fixed overhead is $2,400 per year in equipment costs specifically traceable to the plastic housing line and $1,600 per year in general overhead costs to be allocated to this line

Question

Salley Company makes pagers.Currently,Salley purchases 10,000 plastic housings per year from an outside company for $1 each.One of Salley's engineers suggested that the company make its plastic housings in-house.Estimated unit costs are as follows:
  * Fixed overhead is $2,400 per year in equipment costs specifically traceable to the plastic housing line and $1,600 per year in general overhead costs to be allocated to this line

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The Answer of Salley Company makes pagers.Currently,Salley purchases 10,000 plastic housings per year from an outside company for $1 each.One of Salley's engineers suggested that the company make its plastic housings in-house.Estimated unit costs are as follows:
  * Fixed overhead is $2,400 per year in equipment costs specifically traceable to the plastic housing line and $1,600 per year in general overhead costs to be allocated to this line

Salley Company Makes Pagers