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EEE company produces 1,000 parts per year that are used in the assembly of one of its products. The unit product cost of these parts
EEE company produces 1,000 parts per year that are used in the assembly of one of its products. The unit product cost of these parts is: Variable manufacturing cost Fixed manufacturing cost 14 11 The part can be purchased from an outside supplier for $20 per unit. If the part is purchased from the supplier, two-thirds of the fixed manufacturing costs can be eliminated. What will be the annual impact on the company's net operating income of buying the part from the outside supplier? (positive numbers = an increase; negative numbers = a decrease)
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