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Part P40 is a part used in the production of air conditioners at Jackson Corporation. The following costs and data relate to the production of
Part P40 is a part used in the production of air conditioners at Jackson Corporation. The following costs and data relate to the production of Part P40: Number of parts produced annually Fixed costs Variable costs Total cost to produce 23,000 $41.000 $71,000 $112.000 Jackson Corporation can purchase the part from an outside supplier for $4.32 per unit. If they purchase from the outside supplier, 50% of the fixed costs would be avoided. If Jackson Corporation makes the part, how much will its operating income be? O A $7.860 greater than if the company bought the part OB. $48,860 greater than if the company bought the part OC. $20,500 greater than if the company bought the part OD. $119,860 greater than if the company bought the part
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