The cost to produce Part A was $10 per unit in 2005. During 2006, it has increased to $11 per unit. In 2006, Supplier Company has offered to supply Part A for $9 per unit. For the make-or-buy decision what is incremental revenue?

1. Differential costs are $2 per unit

2. Net relevant costs are $1 per unit

3. Incremental costs are $1 per unit

4. Incremental revenues are $2 per unit

 

Answer rating: 100% (QA)

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