Question: Would the eliminated fixed overhead per unit be added to the total make cost? Please help solve with detailed explanations. 2. Cierra, Inc. manufactures computer

Would the eliminated fixed overhead per unit be added to the

Would the eliminated fixed overhead per unit be added to the total make cost? Please help solve with detailed explanations.

2. Cierra, Inc. manufactures computer chips. Currently, the costs per unit are as follows: direct materials direct labor variable manufacturing overhead fixed manufacturing overhead Total S 1.00 10.00 5.00 8.00 S 24.00 Chips Corp., has contacted Cierra with an offer to sell to Cierra 10,000 of the chips for $22.00 per chip. If Cierra accepts the proposal, $50,000 of the fixed overhead will be eliminated. Should Cierra make or buy the chips? Justify your answer with calculations

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