Homework Answers
Total variable cost = $120,000 + $25,000 + $45,000 = $190,000
Purchase cost of the component is also $190,000.
If the component is purchased, there is a reduction in fixed overhead by $5,000.
The component should be purchased and $5,000 should be saved.
Buy and save $5,000
1st option
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Tex's Manufacturing Company can make 100 units of a necessary component part with the following costs:...
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17-20
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