Rowan Quinn Company manufactures kitchen appliances. Currently, it is manufacturing one of its components at a variable cost of $40 and fixed costs of $15 per unit. An outside provider of this component has offered to sell Rowan Quinn the component for $45. Determine the best plan and calculate the savings assuming fixed costs are unaffected by the decision.

a. $5 savings per unit if purchased

b. $15 savings per unit if purchased

c. $10 savings per unit if manufactured

d. $5 savings per unit if manufactured

Answer rating: 100% (QA)

Given the following information Variable cost per unit if manufactured 40 Fixed costs per unit if ma... View the full answer