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The following information is for Questions 1 and 2 X Company is considering buying a part next year that they currently make. A company has

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The following information is for Questions 1 and 2 X Company is considering buying a part next year that they currently make. A company has offered to supply it for $13.72 per unit. This year's production costs for 3,400 units were as follows: Per-Unit Total Direct materials $3.50 $11,900 Direct labor 3.37 11,458 Total overhead 10.10 34,340 Total costs $16.97 $57,698 $19,720 of total overhead is fixed. If X Company chooses to buy the part, it will still incur xed costs of $8,085. 1. If X Company buys the part next year instead of making it, and production is expected to remain at 3,400 units, it will save egg-g. Tries 2/3 rgmag' ' 2. If X Company buys the part next year instead of making it, and production next year is expected to be 3,900 units, it will save Tries 0/3 X Company currently makes 2,200 units of a unique part for one of its nished products. Variable production costs for this part are $12.14 per unit; fixed costs associated with this part are $11,000 per year. A company has offered to supply X Company with the part for a price of $15.90 per unit. For X Company, the bad news is that it will have to inspect the parts upon arrival, requiring rental of a special machine for $2,400 per year and per-unit inspection costs of $3.30. The good news is that if it buys the part, not only can it avoid all of the fixed costs associated with the production of the part, but it can use the released production facilities to generate $15,000 per year. At what production level would X Company be indifferent between making the part and buying it

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