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The following information is for Questions 11 and 12 X Company is considering buying a part next year that they currently make. This year's production
The following information is for Questions 11 and 12 X Company is considering buying a part next year that they currently make. This year's production costs for 3,400 units were as follows: Per-Unit $3.85 3.73 Direct materials Direct labor Variable overhead Fixed overhead Total Total $13,090 12,682 14,960 13,600 $54,332 4.40 4.00 $15.98 A company has offered to supply this part to X Company for $14.75 per unit. If X Company accepts the offer, it will avoid fixed costs of $6,664, and it will be able to lease the resources that will become available from not making the part for $3,000. Next year's expected production level is 3,800 units. 11. If X Company makes the part next year instead of buying it, it will save A: $862 C: $1,180 D: $1,381|OE: $1,615 F: $1,890 B: $1,009 Tries 0/99 Submit Answer 12. At what production level would X Company be indifferent between making and buying the part next year? A: 3,489 B: 4,640||0C: 6,171 D: 8,208 E: 10,917| F: 14,519
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