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Vaughn Manufacturing incurs the following costs to produce 8500 units of a subcomponent: Direct materials $8000 Direct labor 13000 Variable overhead 13000 Fixed overhead 18000
Vaughn Manufacturing incurs the following costs to produce 8500 units of a subcomponent: Direct materials $8000 Direct labor 13000 Variable overhead 13000 Fixed overhead 18000 An outside supplier has offered to sell Vaughn the subcomponent for $2.60 a unit. If Vaughn could avoid $3000 of fixed overhead by accepting the offer, net income would increase (decrease) by O $(8900). O $(9900). O $(8000). O $14900
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