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Moon Technologies manufactures a part used in the manufacture of digital cameras. Currently, Moon manufactures 60,000 units of the part annually. The annual costs of

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Moon Technologies manufactures a part used in the manufacture of digital cameras. Currently, Moon manufactures 60,000 units of the part annually. The annual costs of producing 60,000 parts include: Management is considering whether to continue manufacturing the part, of to buy the part from on outside supplier at a cost of $24 per part. Purchasing the part from an outside source would enable the company to avold 50% of fixed manufacturing overhead costs. The space freed up by purchasing the part from an outside supplier could be used to manufacture another product that would increase income by $70,000. What is the financial advantage (disadvantage) of making the part rather than buying them from an outside supplier? Multiple Choice 5(745,000) $1,815,000 ($880.000) $2,695,000

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