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Cotton Corp. currently makes 10,000 subcomponents a year in one of its factories. The unit costs to produce are: Direct materials Direct labor Variable manufacturing
Cotton Corp. currently makes 10,000 subcomponents a year in one of its factories. The unit costs to produce are: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total unit cost Per unit $ 32.50 13.00 19.50 26.00 $ 91.00 An outside supplier has offered to provide Cotton Corp. with the 10,000 subcomponents at a $84.50 per unit price. Fixed overhead is not avoidable. What is the maximum price Cotton Corp. should pay the outside supplier? $65.00 $84.50 $91.00 O $58.50
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