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At what purchase price is the company indifferent

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Question - The Hawkeye Company produces commercial mixers used in restaurants and had the following costs related to the production of the handles used on the mixers (a) wages for factory workers $14,600 (b) metal and rubber $28,200 (c) utilities for the factory $3,400 and (d) rent on the factory $18,900. The company is considering purchasing the handles from a supplier; if so, one-third of the fixed costs could be eliminated. For the Hawkeye Company, at what purchase price is the company indifferent between making or buying?

Reference no: EM131761328

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