# Gilberto Company Currently Manufactures

Gilberto Company Currently Manufactures in \$5 only 4) Question 1 (of 13)Question 2 (of 13)Question 3 (of 13)Question 4 (of 13)Question 5 (of 13)Question 6 (of 13)Question 7 (of 13)Question 8 (of 13)Questions 9 – 10 (of 13)Question 11 (of 13)Question 12 (of 13)Question 13 (of 13)

Gilberto Company currently manufactures 60,000units per year of one of its crucial parts. Variable costs are \$2.10 per unit, fixed costs related to making this part are \$60,000 per year, and allocated fixed costs are \$45,000 per year. Allocated fixed costs are unavoidable whether the company makes or buys the part. Gilberto is considering buying the part from a supplier for a quoted price of \$3.30 per unit guaranteed for a three-year period.

Calculate the total incremental cost of making 60,000 units. (Round cost per unit answers to 2 decimal places.)

Calculate the total incremental cost of buying 60,000 units.

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Incremental Costs to Make
Relevant amount per unit
Relevant fixed costs total relevant costs

Total
Incremental
cost to make

Calculate the total incremental cost of buying 50,500 units