Which of the Following Costs Is NOT Relevant to a Make-Or-Buy

question 77

Multiple Choice

Which of the following costs is NOT relevant to a make-or-buy decision?

• A)£10,000 of direct labour used to manufacture the parts
• B)£30,000 of depreciation on the equipment used to manufacture the parts
• C)the supervisor's salary of £25,000, which would be avoided if the part is purchased from an outside supplier
• D)£15,000 in rent from leasing the production space to another company if the part is purchased from an outside supplier

---

Definitions:

Consensual

Involving or based on mutual agreement or consent between the parties involved.

Statutory

Related to or enacted by a statute, referring to laws passed by a legislative body.

Judgment

A formal decision or order given by a court regarding the legal disputes presented to it.

Lien

A creditor's legal claim on a debtor's property, enduring until the associated debt is fully repaid.