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MeGraw Company uses 7750 units of Part X each year as a component in the ossembly of one of its products, The compary in piesently

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MeGraw Company uses 7750 units of Part X each year as a component in the ossembly of one of its products, The compary in piesently producing Part Xinternally ot a total cost or $35.750, computed as follows An outside supplier has offered to provide Part X at a price of $1910 per unit. If McGraw Company stops producing the part interna one-third of the foxed manufacturing overhead would be eliminated Assume that direct labor is a vanoble cost. Required: Crepore on analysis showing the annual financial advantage or disadvantage of nccepting the outside supplier's offet

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