For Hosmer Company, the cost to produce Component Part A was $10 per unit in...
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Accounting
For Hosmer Company, the cost to produce Component Part A was $10 per unit in the previous year. During the current year, the cost to produce Component Part A has increased to $11 per unit. In the current year, a potential supplier has offered to supply Component Part A to Hosmer Company for $9 per unit. For the make-or-buy decision,
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Incremental costs are $1 per unit.
Incremental revenues are $2 per unit.
Differential costs are $2 per unit.
Net relevant costs are $1 per unit.
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