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Switze Corporation makes motorcycle engines. The company's recors show the following unit costs to manufacture part# 61645 Direct materials$12.00 Direct labor$15.00 Variable overhead$20.00 Fixed overhead$10.00
Switze Corporation makes motorcycle engines. The company's recors show the following unit costs to manufacture part# 61645
Direct materials$12.00
Direct labor$15.00
Variable overhead$20.00
Fixed overhead$10.00
Another manufacturer has offered to supply Switzer Corporation with part# 61645 for a cost of $50 per unit. Switzer uses 1,000 units annually.
If Switzer accept the offer, what will be the short run impact on income?
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