Lincoln Company produces a part that is used in the manufacture of one of its products. The unit manufacturing costs of this part, assuming a production level of 5,000 units, are as follows:

- Assuming Lincoln Company can purchase 5,000 units of the part from Sexton Company for $15 each, and the facilities currently used to make the part could be rented out to another manufacturer for $20,000 a year, what should Lincoln Company do?

Question

Lincoln Company produces a part that is used in the manufacture of one of its products. The unit manufacturing costs of this part, assuming a production level of 5,000 units, are as follows:

- Assuming Lincoln Company can purchase 5,000 units of the part from Sexton Company for $15 each, and the facilities currently used to make the part could be rented out to another manufacturer for $20,000 a year, what should Lincoln Company do?

Quizplus · Accepted Answer

The Answer of Lincoln Company produces a part that is used in the manufacture of one of its products. The unit manufacturing costs of this part, assuming a production level of 5,000 units, are as follows:

- Assuming Lincoln Company can purchase 5,000 units of the part from Sexton Company for $15 each, and the facilities currently used to make the part could be rented out to another manufacturer for $20,000 a year, what should Lincoln Company do?

Lincoln Company Produces a Part That Is Used in the Manufacture