The cost to produce Part A was $10 per unit in 20x3 and in 20x4 has increased to $11 per unit

ACCOUNTING

Multiple Choice

The cost to produce Part A was $10 per unit in 20x3 and in 20x4 has increased to $11 per unit. In 20x4, Supplier XYZ has offered to supply Part A for $9 per unit. For the make-or-buy decision,

a. incremental revenues are $2 per unit.

b. incremental costs are $1 per unit.

c. net relevant costs are $1 per unit.

d. differential costs are $2 per unit.

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