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QUESTIONS Super Impact Protection Led produce shock absorbing phone covers that protects smartphones from extreme to the company.cophones $ Direct Materials Direct labour Variable manufacturing
QUESTIONS Super Impact Protection Led produce shock absorbing phone covers that protects smartphones from extreme to the company.cophones $ Direct Materials Direct labour Variable manufacturing overhead Fixed manufacturing overhead Total manufacturing cost 85.000 132.500 65,000 92,000 374,500 Ultra protect Company has offered to supply the phone covers to Super impact Protection Company for $5 per unit. The chief accountant of Super impact Protection is considering the potential benefit of accepting this offer. Upon investigating its overhead costs, the chief accountant found that if Super impact Protection buys the phone covers from Ultra protect Company, it would eliminate $20,000 of total fixed costs, and could use the released production capacity to generate an additional income of $47.000 from producing a different product Required: From a financial perspective, should the phone covers be outsourced? Show full calculations. (10 marks)
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