stones (Round your answer to two decimal places.) $ (Round your answer to two de

Question

stones (Round your answer to two decimal places.)

$ (Round your answer to two decimal places.)

Qui Stone is an ibc business that plans to sell the keepsakes made from stone off the original Lynna Spori building. This group of students is trying to determine what process they should use to cut and paint the stone. For option 1 they would purchase all the necessary equipment at a cost of $725 and they figure that each finished stone will cost about $7.92 to produce. They could also outsource production with a one-time charge of $97 and a unit cost of $9.61.

Explanation / Answer

1. at the production point of 371 units the both costs will be equal, i.e

= 725+(371*$7.92)= $97+(371*$9.61)

2. the total cost for the two options would be the same

3. outsourcing cost = $3662

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