Learning Objective: 6-3 Make appropriate outsourcing decisions Stuart Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,200 containers follows. Unit-level materials Unit-level labor Unit-level overhead Product-level costs* $ 5,900 6,700 3,800 11,700 27,800 Allocated facility-level costs *One-third of these costs can be avoided by purchasing the containers. Russo Container Company has offered to sell comparable containers to Stuart for $2.70 each. Required a. Calculate the total relevant cost. Should Stuart continue to make the containers? b. Stuart could lease the space it currently uses in the manufacturing process. If leasing would produce $11,800 per month, calculate the total avoidable costs. Should Stuart continue to make the containers? a. Total relevant cost Should Stuart continue to make the containers? Yes b. Total avoidable cost Should Stuart continue to make the containers? No