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Stone River manufactures 9,200 products every year. The cost structure of each unit is as follows: Per unit Direct materials $23.00 Direct labor 29.00 Variable
Stone River manufactures 9,200 products every year. The cost structure of each unit is as follows: Per unit Direct materials $23.00 Direct labor 29.00 Variable manufacturing overhead 20.00 Fixed manufacturing overhead 12.00 Total unit cost $84.00 A supplier offers Stone River with 9,200 products at a unit price $93.00. Assume that fixed manufacturing overhead is unavoidable. How would short-term profits change if Stone River purchases from the supplier? Multiple Choice no change Multiple Choice no change $66,240 increase $110,400 increase $193,200 decrease
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