Question: Answer the following questions. 1. Davanit Computers makes 5,200 units of a circuit board, CB76 at a cost of $290 each. Variable cost per

Answer the following questions. 1. Davanit Computers makes 5,200 units of a

Answer the following questions. 1. Davanit Computers makes 5,200 units of a circuit board, CB76 at a cost of $290 each. Variable cost per unit is $140 and fixed cost per unit is $150. Peach Electronics offers to supply 5,200 units of CB76 for $270. If Davanit buys from Peach it will be able to save $10 per unit in fixed costs but continue to incur the remaining $140 per unit. Should Davanit accept Peach's offer? Explain. 1. Davanit Computers makes 5,200 units of a circuit board, CB76 at a cost of $290 each. Variable cost per unit is $140 and fixed cost per unit is $150. Peach Electronics offers to supply 5,200 units of CB76 for $270. If Davanit buys from Peach it will be able to save $10 per unit in fixed costs but continue to incur the remaining $140 per unit. Should Davanit accept Peach's offer? Explain. Begin by calculating the relevant cost per unit. (If a box is not used in the table, leave the box empty; do not enter a zero.) Relevant costs: Unit relevant cost Make Buy Davanit Computers should Peach's offer. When comparing relevant costs between the choices, Peach's offer price is than the cost to continue to produce. Choose from any list or enter any number in the input fields and then continue to the next question. ?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!