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Manor, Inc. currently manufactures 1,300 subcomponents per month in one of its factories. The unit costs to produce the subcomponents are: Direct materials Direct labor

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Manor, Inc. currently manufactures 1,300 subcomponents per month in one of its factories. The unit costs to produce the subcomponents are: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total unit cost Per unit $ 19 59 46 53 $177 Manor is considering purchasing the subcomponents from an outside suppller who normally charges $190 per unit. The supplier also has an 'Exclusive Buyer's Club which costs $19.000 per month to join, but whose members can purchase the subcomponents for $140 per unit. Fixed overhead is not avoidable. If Manor chose to purchase the subcomponents using the cheaper of the two buying options, what would be the effect on profit? (Do not round intermediate calculations.) Multiple Choice Decrease $39.800 Increase $46.000 Increase 5257400 Deconse585,800

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