Calculate relevant cost to make

Reference no: EM132984797

Question: The Marigold Company manufactures 4,500 units of a part that could be purchased from an outside supplier for $16 each. Marigold's costs to manufacture each part are as follows:

Direct materials $4
Direct labor 3
Variable manufacturing overhead 6
Fixed manufacturing overhead 10
Total $23

All fixed overhead is unavoidable and is allocated based on direct labor. The facilities that are used to manufacture the part have no alternative uses.

Calculate relevant cost to make.

Should Marigold continue to manufacture the part?

Reference no: EM132984797

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