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Han Products manufactures 21,000 units of part S-6 each year for use on...

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Accounting

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Han Products manufactures 21,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead $5.60 7.00 3.60 12.00 Total cost per part $28.20 An outside supplier has offered to sell 21,000 units of part S-6 each year to Han Products for $41.50 per part. If Han Products accepts this offer, the facilities now being used to manufacture part S-6 could be rented to another company at an annual rental of $442,300. However, Han Products has determined that two-thirds of the fixed manufacturing overhead being applied to part S-6 would continue even if part S-6 were purchased from the outside supplier Required a. Calculate the per unit and total relevant cost for buying and making the product? (Round your Per Unit answers to 2 decimal places.) ni 21,000 Units Differential Costs Make Buy Make Cost of purchasing Cost of making: Direct materials Direct labor Variable overhead Fixed overhead Total cost S 0.00 S 0.00 S 0

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