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LPR Company makes 20,800 units per year of a component part that it uses in the products it manufactures. The unit cost of this component
LPR Company makes 20,800 units per year of a component part that it uses in the products it manufactures. The unit cost of this component part is given below: direct materials $26.24 direct labor ... $31.97 variable overhead $14.63 allocated fixed overhead $11.25 An outside supplier has offered to sell LPR Company 20,000 units of this part for $82.66 per unit. If LPR Company accepts this offer, the facilities now being used to make the part could be used to make more units of a product that is in high demand. The additional contribution margin earned on this other product would be $69,000 per year. Calculate the amount by which the company's net income will decrease if LPR Company accepts the outside suppliers offer. Do not enter your answer with a minus sign in front of your number
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