Question: Kando Company incurs a 9 per unit cost for
Kando Company incurs a $ 9 per unit cost for Product A, which it currently manufactures and sells for $ 13.50 per unit. Instead of manufacturing and selling this product, the company can purchase Product B for $ 5 per unit and sell it for $ 12 per unit. If it does so, unit sales would remain unchanged and $ 5 of the $ 9 per unit costs assigned to Product A would be eliminated. Should the company continue to manufacture Product A or purchase Product B for resale?
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