Altec Services Corporation Has Relevant Costs of $40 Per Unit

question 135

Multiple Choice

Altec Services Corporation has relevant costs of $40 per unit to manufacture 1,000 units of Part A.A current supplier offers to make Part A for $35 per unit.Alternatively,the company can rent out the capacity for $25,000.If capacity is constrained,the opportunity cost of buying Part A from the supplier is ________.

• A) $0
• B) $5,000
• C) $35,000
• D) $25,000

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Definitions:

Structural Considerations

Factors related to the organizational, physical, or logical arrangement of a system or enterprise that need to be taken into account when planning or evaluating.

Management Function

The organizational activities of planning, organizing, leading, and controlling to achieve goals efficiently and effectively.

Chain Of Command

The formal line of authority within an organization, defining who reports to whom, from the highest levels of leadership down to frontline employees.

Small Businesses

Enterprises or firms with limited revenue, employees, or resources, often characterized by independent ownership and operation.