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Make or Buy Harper Company incurs a total cost of $261,000 in producing 21,000 units of a component needed in the assembly of its major
Make or Buy Harper Company incurs a total cost of $261,000 in producing 21,000 units of a component needed in the assembly of its major product. The component can be purchased from an outside supplier for $6 per unit. A related cost study indicates that the total cost of the component includes fixed costs equal to 80% of the variable costs involved. Should Harper buy the component if it cannot otherwise use the released capacity? Present your answer in the form of differential analysis Use negative sign represent a net disadvantage answer, otherwise do not use negative signs with your answers. Cost from outside supplier $Answer Variable costs avoided by purchasing Answer Net advantage (disadvantage) to purchase $Answer alternative What would be your answer to requirement (a) if the released capacity could be used in a project that would generate S17,000 of contribution margin? Use negative sign represent a net disadvantage answer, otherwise do not use negative signs with your answers. Cost from outside supplier $Answer Variable costs avoided by purchasing Answer Contribution margin generated by new Answer project Net advantage (disadvantage) to purchase $Answer alternative
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