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Bounce Company has collected the following information: Cost to buy one unit $24 Production costs per unit: Direct materials $10 Direct labor $8 Variable manufacturing
Bounce Company has collected the following information:
Cost to buy one unit
$24
Production costs per unit:
Direct materials
$10
Direct labor
$8
Variable manufacturing overhead
$1
Total fixed manufacturing overhead
$95,000
What level of production is needed for Bounce to be indifferent between making or buying the part, assuming it can eliminate $75,000 of fixed costs?
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