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Kirkland Company manufactures a part for use in its production of hats. When items are produced, the costs per unit are: Direct materials $0.60 Direct
Kirkland Company manufactures a part for use in its production of hats. When items are produced, the costs per unit are: Direct materials $0.60 Direct manufacturing labor 3.00 Variable manufacturing overhead 1.20 Fixed manufacturing overhead 1.60 Total $6.40 Mike Company has offered to sell to Kirkland Company units of the part for $6.00 per unit. if Kirkland accepts the offer $1.00 per unit of fixed manufacturing overhead on the original item would be avoided. Total cost per unit for making the original part will be $5.80 O True False
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