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Speck Company Manufactures a Part for Its Production Cycle

Question 13

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Speck Company manufactures a part for its production cycle. The costs per unit for 10,000 units of this part are as follows:
Speck Company manufactures a part for its production cycle. The costs per unit for 10,000 units of this part are as follows:    The fixed factory overhead costs are unavoidable. -Troxel Company has offered to sell 10,000 units of the same part to Speck for $26 a unit. Assuming no other use for the facilities, Speck should A)  buy from Troxel as this would save $2 per unit. B)  make the part as this would save $2 per unit. C)  buy from Troxel as this would save $10 per unit. D)  make the part as this would save $10 per unit. The fixed factory overhead costs are unavoidable.
-Troxel Company has offered to sell 10,000 units of the same part to Speck for $26 a unit. Assuming no other use for the facilities, Speck should


A) buy from Troxel as this would save $2 per unit.
B) make the part as this would save $2 per unit.
C) buy from Troxel as this would save $10 per unit.
D) make the part as this would save $10 per unit.

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