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Oriole Company manufactures widgets. Sandhill Company has approached Oriole with a proposal to sell the company widgets at a price of $60600 for 100,000 units.
Oriole Company manufactures widgets. Sandhill Company has approached Oriole with a proposal to sell the company widgets at a price of $60600 for 100,000 units. Oriole is currently making these components in its own factory. The following costs are associated with this part of the process when 100,000 units are produced: The manufacturing overhead consists of $12900 of costs that will be eliminated if the components are no longer produced by Oriole. From Oriole's point of view, how much is the incremental cost or savings if the widgets are bought instead of made? $14300 incremental savings $2700 incremental savings $14300 incremental cost $2700 incremental cost
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