[ChHafsa]

Thank you very much got it

[ChHafsa]

Cam Co manufactures webcams and is about the launch a new version of its product, the Webcam X, for which the following information is available:

Projected lifetime sales volume 50,000 units
Product development costs (already incurred) $1,250,000
Marketing costs $1,750,000
Manufacturing costs per unit, based on the prototype, are as follows:

$
Direct material 40
Direct labour 26
Machine costs 21
Quality control costs 10
Rework costs 3
Total manufacturing costs per unit 100
The procurement officer has stated that the materials can be sourced from another supplier, reducing direct material costs by 10%.

What is the lifecycle cost per unit?

A.$121
B.$131
C.$156
D.$160

This is the question in study hub the thing i dont understand is why have we taken reduced material price while it states that director can source from another supplier which means he hasnt taken the price yet?

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