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Plainfield Company manufactures part G for use in its production cycle. The full cost per unit for each of 10,000 units of part G manufactured

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Plainfield Company manufactures part G for use in its production cycle. The full cost per unit for each of 10,000 units of part G manufactured per year by Plainfield are as follows: Direct materials Direct labor Variable overhead Fixed overhead $ 2 18 7 6 $ 33 Verona Company has offered to sell Plainfield 10,000 units of part G for $30 per unit. If Plainfield accepts Verona's offer, the released facilities could be used to save $47.000 in relevant costs in the manufacture of part H. In addition, $3 per unit of the fixed overhead applied to part would be eliminated. Based solely on a short-term financial analysis, which alternative is more desirable and by what amount? A) B) ) D) E) Alternative Manufacture Manufacture Buy Buy Buy Amount $ 10,000 $ 27,000 $ 47,000 $ 77,000 $ 10,000 O Option A O Option B Option C O Option D O O Option E

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