Question
Highlander Company uses 10,000 units of a part in its production process. The costs to make a part are: DM per unit $10 DL per
Highlander Company uses 10,000 units of a part in its production process. The costs to make a part are:
| DM per unit | $10 |
| DL per unit | $25 |
| VOH per unit | $15 |
| FOH per unit | $10 |
Highlander has received a quote of $70 from a potential supplier for this part. If Highlander buys the part, 70 percent of the fixed overhead would continue.
Indicate whether Highlander should make or buy the part and the dollar amount difference between make and buy.
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Fundamental Accounting Principles
Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta
20th Edition
1259157148, 78110874, 9780077616212, 978-1259157141, 77616219, 978-0078110870
