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Erin Co. currently manufactures a part for one of its products. However, management is considering buying this part from an outside supplier instead. Management
Erin Co. currently manufactures a part for one of its products. However, management is considering buying this part from an outside supplier instead. Management has put together the first two columns in the incremental analysis table below: Make $105,000 $130,000 Direct materials Direct labor Variable MOH Fixed MOH Purchase price $0 $50,000 $70,000 Buy SO $0 $0 $30,000 $345,000 Based on this information, should Erin Co. make or buy the part?
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Managerial Accounting Tools for Business Decision Making
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso, Ibrahim M. Aly
3rd Canadian edition
978-1118727737, 1118727738, 978-1118033890
