Delicious Preserves currently makes jams and jellies and a variety of decorative jars used for packaging. An outside supplier has offered to supply all of the needed decorative jars. For this make - or - buy decision, a cost analysis revealed the following avoidable unit costs for the decorative jars: Direct materials $0.50 Direct labor 0.11 Unit – related support costs 0.24 Batch - related support costs 0.25 0 45 Product- sustaining support costs 0.62 Facility- sustaining support costs Total cost per jar $2.17 The maximum price that Delicious Preserves should be willing to pay for the decorative jars is si ...... O A. $0.61 per jar O B. $0.85 per jar -1 1/1 O C. $2.17 per jar - (1/ O D. $0 45 per jar 36

Delicious Preserves currently makes jams and jellies and a variety of decorative jars used for packaging. An outside supplier has offered to supply all of the needed decorative jars. For this make - or - buy decision, a cost analysis revealed the following avoidable unit costs for the decorative jars: Direct materials $0.50 Direct labor 0.11 Unit – related support costs 0.24 Batch - related support costs 0.25 0 45 Product- sustaining support costs 0.62 Facility- sustaining support costs Total cost per jar $2.17 The maximum price that Delicious Preserves should be willing to pay for the decorative jars is si ...... O A. $0.61 per jar O B. $0.85 per jar -1 1/1 O C. $2.17 per jar - (1/ O D. $0 45 per jar 36

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 7CE

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