Question: Xia Co. currently buys a component part for $5 per unit. Xia believes that making the part would require $2 25 per unit of direct
Xia Co. currently buys a component part for $5 per unit. Xia believes that making the part would require $2 25 per unit of direct materials and $1 00 per unit of direct labor Xia allocates overhead using a predetermined overhead rate of 200% of direct labor cost. Xia estimates an incremental overhead rate of $0.75 per unit to make the part. What are the relevant costs for Xia to make or buy the part? (Round your answers to 2 decimal places.) Should Xia make or buy the part? Make buy
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