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X Company currently buys a part from a supplier for $12.37 per unit but is considering making the part itself next year. This year, they
X Company currently buys a part from a supplier for $12.37 per unit but is considering making the part itself next year. This year, they purchased 3,500 units of this part; next year, they will need 3,800 units. Estimated costs to make the part next year are: Direct materials Direct labor Variable overhead Fixed overhead Total Per-Unit $3.00 3.66 2.90 3.60 $13.16 Total $10,500 12,810 10,150 12,600 $46,060 of the estimated fixed overhead, $6,930 would be additional fixed overhead costs; the remainder would be common costs allocated to the part. X Company currently receives $2,300 a year by renting unused factory space, but it will have to use this space to make the part. If X Company makes the part instead of continuing to buy it, it will save OA: $1,089 B: $1,448 OC: $1,926 OD: $2,561 OE: $3,407| OF: $4,531 Submit Answer Tries 0/99
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