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Melody is currently producing 100 component parts by incurring costs of $60,000 for direct materials, $12,500 for direct labor, $22,500 for variable overhead, and $15,000
Melody is currently producing 100 component parts by incurring costs of $60,000 for direct materials, $12,500 for direct labor, $22,500 for variable overhead, and $15,000 for fixed overhead. Next year, Melody has budgeted requirements for 150 components. If Melody purchases these components from an external vendor, $10,000 of fixed costs would be eliminated. What is the maximum amount that Melody would be willing to pay the external vendor for these 150 component parts?
A : $152,500
B : $100,000
C : $105,000
D : $147,500
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