Lewis S.Gray Inc.manufactures a part for use in its production of art deco furniture.When 10,000 items are produced,the costs per unit are:
Colonial Accents Company has offered to sell to Lewis S.Gray 10,000 units of the part for $125 per unit.The plant facilities could be used to manufacture another part at a savings of $180,000 if Lewis S.Gray accepts the supplier's offer.In addition,$30 per unit of fixed manufacturing overhead on the original part would be eliminated.
Required:
a.What is the relevant per unit cost for the original part?
b.Which alternative is best for Lewis S.Gray Company? By how much?
Definitions:
Sexual Energy
An abstract concept often associated with the driving force behind human sexual behavior as well as creativity, according to certain psychological and philosophical theories.
Freud's Ideas
Theories proposed by Sigmund Freud that focus on unconscious motives and conflicts, primarily through the lens of psychoanalysis.
Determinist
An advocate or believer in determinism, the philosophical concept that all events, including moral choices, are ultimately determined by causes external to the will.
Sexual Tendencies
Sexual tendencies refer to patterns or orientations of sexual attraction, behavior, and preferences within individuals.
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