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i need help doing this question Question 3 (10 marks) Switty Company manufactures mopeds. All parts for the moped, including the engine, are made by
i need help doing this question
Question 3 (10 marks) Switty Company manufactures mopeds. All parts for the moped, including the engine, are made by Swifty. Each year S manufactures 24.000 enaines. The cost to make each enaine is shown below. An outside supplier called Shorty Ltd. has offered to sell Swifty the 24,000 engines it needs for $434.00 per engine. If accepts this offer, the facilities now being used to make the engines could be rented out for $495,000 per year. If the engines were purchased from Shorty, $88.00 of the fixed manufacturing overhead cost per engine would be avoidable Required: If Swifty purchases the engines from Shorty, how much will operating income CHANGE? A) 5(6,790,000) B) $4,599,000 C) $777,000 D) $(6,312,000) E) $1,767,000 F) $1,272,000 G) $(5,322,000) Step by Step Solution
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