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Thomas Industries manufactures 30.000 units of part X815 each month for use in the production of its products. The facilities currently being used to produce

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Thomas Industries manufactures 30.000 units of part X815 each month for use in the production of its products. The facilities currently being used to produce part X815 have a fixed monthly cost of $150,000 and the capacity to produce 35,000 units per month. If Thomas were to buy part XB15 from an outside supplier, then these facilities would be idle. Fixed costs associated with the facilities, however, would continue at 40% of their current amount. The variable production costs of part X815 are $11 per unit. If Thomas can buy part X815 from an outside supplier at a price of $13 per unit, then the monthly financial advantage or disadvantage of outsourcing the part would be: 530,000 advantage $180,000 disadvantage $90,000 disadvantage $120,000 advantage None of the above

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