Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Texs Manufacturing Company can make 100 units of a necessary component part with the following costs: Direct Materials $120,000 Direct Labor 25,000 Variable Overhead 45,000

Texs Manufacturing Company can make 100 units of a necessary component part with the following costs:

Direct Materials $120,000

Direct Labor 25,000

Variable Overhead 45,000

Fixed Overhead 30,000

If Texs Manufacturing Company purchases the component externally, $20,000 of the fixed costs can be avoided. At what external price for the 100 units is the company indifferent between making or buying?

$210,000

$190,000

$220,000

$200,000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Technical Audit A Thoroughfare Of System Perfection MBTA Management By Technical Audit

Authors: Shankar Bakhsh Srivastava

1st Edition

3848483343, 978-3848483341

More Books

Students also viewed these Accounting questions

Question

=+4. Which dimension is the lowest?

Answered: 1 week ago