Peter CoMakes and Uses 5,000 Components Each Year in Its Manufacturing

question 70

Multiple Choice

Peter Co.makes and uses 5,000 components each year in its manufacturing operations.An outside supplier has offered to supply the components to Peter at $66 per unit.Peter's production costs are as follows: If Peter accepts the order,$8 of fixed overhead per unit will be eliminated.
What is the per unit relevant cost of producing the product in this decision?

• A)$86
• B)$52
• C)$78
• D)$60

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Definitions:

United States

A country in North America consisting of 50 states and a federal district, known for its significant cultural and economic influence globally.

Boas

Franz Boas was an anthropologist who is considered one of the founders of cultural anthropology and an advocate of cultural relativism.

Pavlov

A Russian physiologist known for his work in classical conditioning, demonstrating how organisms can learn to associate a neutral stimulus with a reflexive response.

Wundt

Refers to Wilhelm Wundt, a German physician, physiologist, and philosopher, widely regarded as the father of experimental psychology.