Rubium Micro Devices currently manufactures a subassembly for its main product. The costs per unit are as follows:

Direct materials $$51\mathrm{.}00$

Direct labor $43\mathrm{.}00$

Variable overhead $38\mathrm{.}00$

Fixed overhead $33\mathrm{.}00$

Total $$165\mathrm{.}00$

Crayola Technologies Inc. has contacted Rubium with an offer to sell $10,000$ of the subassemblies for $$138\mathrm{.}00$ each. Rubium will eliminate $$89,000$ of fixed overhead if it accepts the proposal. What are the relevant costs for Rubium?

 

 

Answer rating: 100% (QA)

Relevant costs for Rubium in this scenario are the variable costs associated ... View the full answer