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ABC company produces 2,000 office equipment annually for its main product. The costs per equipment are as follows: Direct material 3 Direct labor 7 Variable
ABC company produces 2,000 office equipment annually for its main product. The costs per equipment are as follows:
Direct material | 3 |
---|---|
Direct labor | 7 |
Variable overhead | 4 |
Fixed overhead | 7 |
Total |
They received an offer to buy the 2,000 units for $18 per unit. And, $4 of the fixed overhead per unit is unavoidable. How much is the differential cost of buying and producing? (write down your answer in number, e.g.: 60,000 , or -60,000 if negative.
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