The Cost to Produce Part a Was $20 Per Unit

Multiple Choice

The cost to produce Part A was $20 per unit in 2019. During 2020, it has increased to $23 per unit. In 2020, Supplier Company has offered to supply Part A for $18 per unit. For the make-or-buy decision,

A) incremental revenues are $5 per unit.
B) incremental costs are $3 per unit.
C) net relevant costs are $3 per unit.
D) differential costs are $5 per unit.