Data presented what it be advisable to make carrying case

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Matchless computer company has been purchasing carrying cases for its portable computers and delivered cost of $55 per unit the company which is currently operating below full capacity charges factory overhead to production at the rate of 40 percent of the labor cost the fully absorbed unit cost to produce comparable carrying cases are expected to be as follows direct materials $28 direct labor $20 factory overhead 8.00 total cost per unit $56 if matchless computer company manufactures the carrying cases fixed factory overhead costs will not increase in variable factory overhead costs associated with cases are expected to be 15% of the direct labor cost A prepare a differential analysis dated October 11 2012 to determine whether the company should make alternate one or by alternate to the carrying case B on the basis of data presented what it be advisable to make the carrying case or to continue buying them explain

Reference no: EM13776393

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