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Perez Electronics currently produces the shipping containers it uses to deliver the electronics products it...

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Accounting

Perez Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,200 containers follows.
Unit-level materials $ 5,100
Unit-level labor 6,200
Unit-level overhead 4,000
Product-level costs*9,000
Allocated facility-level costs 26,900
*One-third of these costs can be avoided by purchasing the containers.
Russo Container Company has offered to sell comparable containers to Perez for $2.90 each.
Required
Calculate the total relevant cost. Should Perez continue to make the containers?
Perez could lease the space it currently uses in the manufacturing process. If leasing would produce $11,300 per month, calculate the total avoidable costs. Should Perez continue to make the containers?

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