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Han Products manufactures 70.000 units of part 5-6 each year for use on its production line. At this level of activity, the cost per unit

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Han Products manufactures 70.000 units of part 5-6 each year for use on its production line. At this level of activity, the cost per unit for part 5-6 is as follows: Direct materials Direct labour Variable overhead Fixed overhead Total cost per part $7.50 13.50 5.50 11.40 338.90 An outside supplier has offered to sell 62.500 units of part 5-6 each year to Han Products for $34.00 per part. Man Products accepts this offer the facilities now being used to manufacture par 5-6 could be rented to another company at an annual rental of $116.000 However. Han Products has determined that 30% of the fixed overhead being applied to part 5-6 wil be avoided rear S-6 purchased from the outside supplier Required: 1. What is the net dollar advantage or disadvantage of accepting the outside suppler's offer? (Round "Total corte and final answer to the nearest whole dollar amount.) 2. What is the annual rental value at which the company will be indifferent between the two options? (Round "Total costs and final answer to the nearest whole doller amount.) Annual rental value

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