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10-1 THANK YOU Beto Company pays $3.10 per unit to buy a part...

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Accounting

imageimage10-1 THANK YOU

Beto Company pays $3.10 per unit to buy a part for one of the products it manufactures. With excess capacity, the company is considering making the part. Making the part would cost \$2.10 per unit for direct materials and $1.00 per unit for direct labor. The company normally applies overhead at the predetermined rate of 200% of direct labor cost. Incremental overhead to make the part would be 80% of direct labor cost. (a) Prepare a make or buy analysis of costs for this part. (Enter your answers rounded to 2 decimal places.) (b) Should Beto make or buy the part? Colt Company produces two skateboard models. Machine time per unit for Hero is two hours and for Flip is one hour. The machine's capacity is 1,940 hours per year. Colt can sell up to 704 units of Hero and 832 units of Flip per year. Selling prices and variable costs follow

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