a. What is the break-even quantity? Round your answer to the nearest whole number. units b. Should the firm make the 8,600 units in-house or outsource? Firm should produce the molding -Select-

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20th Edition
ISBN:9780357033791
Author:Pride, William M
Publisher:Pride, William M
Chapter19: Pricing Concepts
Section: Chapter Questions
Problem 6DRQ
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The Vera Molding company has two alternatives for meeting a customer requirement for 8,600 units of a
specialty molding. If done in-house, fixed cost would be $340,000 with variable cost at $40 per unit.
Alternative two is to outsource for a total cost of $90 per unit.
a. What is the break-even quantity? Round your answer to the nearest whole number.
units
b. Should the firm make the 8,600 units in-house or outsource?
Firm should produce the molding -Select-
Transcribed Image Text:The Vera Molding company has two alternatives for meeting a customer requirement for 8,600 units of a specialty molding. If done in-house, fixed cost would be $340,000 with variable cost at $40 per unit. Alternative two is to outsource for a total cost of $90 per unit. a. What is the break-even quantity? Round your answer to the nearest whole number. units b. Should the firm make the 8,600 units in-house or outsource? Firm should produce the molding -Select-
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