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Concord Corporation produces 5000 units of part A12E. The following costs were incurred for that level of production: Direct materials $ 50000 Direct labor 155000
Concord Corporation produces 5000 units of part A12E. The following costs were incurred for that level of production:
Direct materials | $ 50000 |
Direct labor | 155000 |
Variable overhead | 70000 |
Fixed overhead | 175000 |
If Concord buys the part from an outside supplier, $35000 of the fixed overhead is avoidable. If the outside supplier offers a unit price of $65, net income will increase (decrease) by
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