Question 2 (30 points) MAT Ltd, which manufactures part M-6 for use in its production...
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Question 2 (30 points) MAT Ltd, which manufactures part M-6 for use in its production cycle has the following cost per unit: It has been established that 2/3 of the overhead is fixed. Abubakar Company Ltd has offered to sell 25,000 units of the part M-6 to MAT Ltd for #120 per unit. If MAT Ltd accepts Abubakar Company Ltd's offer, some of the facilities presently used to manufacture M-6 could be rented to a third party at an annual rent of 600,000. Additionally, 10 per unit of the fixed overhead cost applied to the part M-6 would be totally eliminated. The Managing Director of Mat Ltd has called on you to advise on whether he should accept Abubakar Company Ltd's offer, or not
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