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Blue Company produces 10,000 units of a part that it needs for of its product. A supplier notified Blue Company that it woutd sat at

Blue Company produces 10,000 units of a part that it needs for of its product. A supplier notified Blue Company that it woutd sat at the same part for a price of $9 per part The annual production costs to produce the needed 10,000 parts are as follows. Direct materials Direct labor Variable Indirect production costs Fixed Indirect production costs $27,000 ) 30,000 14,000 44,000 All the fixed indirect production costs are unavoidable. Required: 1.Determine if Blue Company should buy the part or produce it internally. Show the relevant 2. If you discover that one half of the fixed indirect production costs can be eliminated. Does that change the decision.

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