Revved Up Toys manufactures a computer chip used in the production of remote control cars. When 6,000 cars are produced, the costs per part are:
Sam's Associates has offered to sell Revved Up Toys 6,000 parts for $5.75 each. If Revved Up Toys accepts the offer, $1.00 of the fixed manufacturing overhead costs can be eliminated.
a. What is the relevant per unit cost to manufacture the part?
b. Which alternative is best for Revved Up Toys and by how much?
Definitions:
Conducting System
A network of specialized cardiac muscle cells responsible for initiating and distributing the electrical impulses that stimulate heart contraction.
AV Valve
The atrioventricular (AV) valve regulates blood flow from the atria to the ventricles in the heart.
Bundle of His
A collection of heart muscle cells specialized for electrical conduction that transmits the electrical impulses from the AV node to the point of the apex of the fascicular branches.
Pulmonary Veins
Blood vessels that carry oxygenated blood from the lungs to the left atrium of the heart.
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