Martinez Manufacturing makes two products, one of which is produced at a significantly higher volume than the

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Martinez Manufacturing makes two products, one of which is produced at a significantly higher volume than the other. The low-volume product consumes more of the company’s engineering resources because it is technologically complex. Even so, the company’s cost accountant chose to allocate engineering department costs based on the number of units produced. How could selecting this allocation base affect a decision about outsourcing engineering services for the low-volume product?

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