1. Gelb Company currently manufactures 58,500 units per year of a key component for its manufacturing process. Variable costs are $5.15 per unit, fixed costs related to making this component are $73,000 per year, and allocated fixed costs are $75,500 per year. The allocated fixed costs are unavoidable whether the company makes or buys this component. The company is considering buying this component from a supplier for $3.90 per unit. Calculate the total incremental cost of making 58,500 and buying 58,500 units. Should it continue to manufacture the component, or should it buy this component from the outside supplier? (Round "purchase price per unit" answer to 2 decimal places.)

2. Cobe Company has already manufactured 15,000 units of Product A at a cost of $20 per unit. The 15,000 units can be sold at this stage for $410,000. Alternatively, the units can be further processed at a $230,000 total additional cost and be converted into 5,800 units of Product B and 11,800 units of Product C. Per unit selling price for Product B is $108 and for Product C is $53.

Prepare an analysis that shows whether the 15,000 units of Product A should be processed further or not.

3. Suresh Co. expects its five departments to yield the following income for next year.

Management eliminates departments with expected net losses.

4. Suresh Co. expects its five departments to yield the following income for next year.

Calculate the total incremental cost of making 58,500 units. (Round "variable Incremental Costs to Make Relevant Amount per Unit Relevant Total Relevant Fixed Costs Costs Variable cost per unit Fixed manufacturing costs Total incremental cost to make