During 2021, it costs Miller, Inc. $14 per unit to produce part T5. During 2022, it has increased to $16 per unit. In 2021, King Company has offered to provide Part T5 for $13 per unit to Miller. As it pertains to the make-or-buy decision, which statement is true?

Question

Differential costs are $4 per unit.
Incremental costs are $3 per unit.
Net relevant costs are $3 per unit.
Incremental revenues are $1 per unit.

Answer 1

Net relevant costs are $3 per unit.

Answer 2

Thank

Answer 3

You're welcome!