solve A and B
value: 10.00 points Han Products manufactures 22,000 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: 5.70 Direct materials Direct labor 7.00 Variable manufacturing overhead 3.40 Fixed manufacturing overhead 9.00 25.10 Total cost per part An outside supplier has offered to sell 22,000 units of part S-6 each year to Han Products for $43.50 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 $525,800. 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.) Per Unit 22,000 Units Differential Costs Make Buy Make Buy Cost of purchasing Cost of making: Direct materials 5.70 Direct labor 7.00 Variable overhead 3.40 Fixed overhead 16.10 0.00 Total cost Show transcribed image text value: 10.00 points Han Products manufactures 22,000 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: 5.70 Direct materials Direct labor 7.00 Variable manufacturing overhead 3.40 Fixed manufacturing overhead 9.00 25.10 Total cost per part An outside supplier has offered to sell 22,000 units of part S-6 each year to Han Products for $43.50 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 $525,800. 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.) Per Unit 22,000 Units Differential Costs Make Buy Make Buy Cost of purchasing Cost of making: Direct materials 5.70 Direct labor 7.00 Variable overhead 3.40 Fixed overhead 16.10 0.00 Total cost
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