Answer:
1.Total cost of making = $1,632,000.
2) Incremental cost of buying $<em>204,000
</em>
3.)The company should make the product as it will save $204,000 by doing so
Explanation:
1) Total cost of making = unit cost× units required cost
Total cost of making = 24.00 × 68,000= 1,632,000.0
2) Total incremental cost of buying
<em>Relevant cost of making</em>
Unit variable cost= (5.00 + 9.00+ (30%× 10)=17
Total variable cost of making = 17 ×68,000 = 1,156,000
<em>Relevant cost of buying </em>68,000× 20 = <u> 1,360,000
</u>
Incremental cost of buying <u><em>204,000
</em></u>
<u><em></em></u>
3) Haver should make the product as it will save $204,000 by doing so
