The Cost to Produce Part a Was $5 Per Unit

question 65

Multiple Choice

The cost to produce Part A was $5 per unit in 2015.During 2016, it has increased to $8 per unit.In 2016, Supplier Company has offered to supply Part A for $6 per unit.For the make-or-buy decision,

• A)incremental revenues are $1 per unit.
• B)incremental costs are $3 per unit.
• C)net relevant costs are $3 per unit.
• D)differential costs are $2 per unit.