Vaughns Manufacturing Company can make 100 units of a necessary component part with the following costs Direct Materials $121000 Direct Labor 26000 Variable Overhead 52000 Fixed Overhead 30000 If Vaughns Manufacturing Company can purchase the component externally for $195000 and only $3000 of the fixed costs can be avoided, what is the correct make or buy decision Make and save $7000 Buy and save $7000 Buy and save $18000 Make and save $18000

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Vaughns Manufacturing Company can make 100 units of a necessary component part with the following costs: Direct Materials $121000 Direct Labor 26000 Variable Overhead 52000

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

Direct Materials	$121000
Direct Labor	26000
Variable Overhead	52000
Fixed Overhead	30000

If Vaughns Manufacturing Company can purchase the component externally for $195000 and only $3000 of the fixed costs can be avoided, what is the correct make-or-buy decision?

Make and save $7000

Buy and save $7000

Buy and save $18000

Make and save $18000

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