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Marty Monitors Ltd., a manufacturer of computer monitors, currently produces a 19-inch LCD monitor. The company's accounting department has reported the following annual costs of

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Marty Monitors Ltd., a manufacturer of computer monitors, currently produces a 19-inch LCD monitor. The company's accounting department has reported the following annual costs of producing the LCD monitor internally: Marty Monitors Annual Production Costs for 19-inch LCD Monitor Per Unit 10,000 Units Direct Materials $29.00 $290,000 Direct Labor $15.00 $150,000 Variable Overhead $9.00 $90,000 Production Supervisor's Salary $12.00 $120,000 Depreciation of LCD manufacturing equipment $10.00 $100,000 Allocated Fixed Overhead $14.00 $140,000 Total Cost $89.00 $890,000 An external supplier has offered to provide Marty Monitors 10,000 units of the same LCD monitor per year at a price of $50 each

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