Question
Nine Corp currently makes 2,000 subcomponents a year in one of its factories. The unit costs to produce are: Description Per unit Direct materials $4
Nine Corp currently makes 2,000 subcomponents a year in one of its factories. The unit costs to produce are:
Description | Per unit |
Direct materials | $4 |
Direct labor | 4 |
Variable manufacturing overhead | 2 |
Fixed manufacturing overhead | 3 |
An outside supplier has offered to provide Nine Corp. with the 2,000 subcomponents at a $19 per unit price. Fixed overhead is not avoidable. If Nine Corp. decides to buy from the outside supplier, the impact to net income will be ?
If positive, enter the number, if negative, place a sign before your number
(please show how you got the answer steps, that way I can use it to answer other questions, please and thanks!)
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