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A company currently buys a key part for...

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Accounting

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A company currently buys a key part for a product it manufactures. The company buys the part for $20.00 per unit and believes it can make the part for $6.00 for direct materials and $10.00 for direct labor. The company allocates overhead costs at a rate of 25% of direct labor. Incremental overhead costs to make this part are $3.00 per unit. Based on the cost relevant to the decision, how much does it costs the company to MAKE the part? $19.00 $16.00 $18.50 $20.00 $21.50 Make or Buy Decision (part 2) (Same information as in Question 2). A company currently buys a key part for a product it manufactures. The company buys the part for $20.00 per unit and believes it can make the part for $6.00 for direct materials and $10.00 for direct labor. The company allocates overhead costs at a rate of 25% of direct labor. Incremental overhead costs to make this part are $3.00 per unit. Based on the cost relevant to the decision, should the company make or buy the part? Make Need more information to determine if the company should make or buy the product Buy

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