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Fornelli, Inc

Question 4

Multiple Choice

Fornelli, Inc. can produce 100 units of a component part with the following costs: Fornelli, Inc. can produce 100 units of a component part with the following costs: If Fornelli, Inc. can purchase the component part externally for $44,000 and only $4,000 of the fixed costs can be avoided, what is the correct make-or-buy decision? A) Make and save $500 B) Buy and save $500 C) Make and save $2,500 D) Buy and save $6,500 If Fornelli, Inc. can purchase the component part externally for $44,000 and only $4,000 of the fixed costs can be avoided, what is the correct make-or-buy decision?


A) Make and save $500
B) Buy and save $500
C) Make and save $2,500
D) Buy and save $6,500

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