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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 Total

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 Total
Direct materials $2.84 $9,656
Direct labor 3.21 10,914
Variable overhead 4.40 14,960
Fixed overhead 3.40 11,560
Total $13.85 $47,090

A company has offered to supply this part to X Company for $13.70 per unit. If X Company accepts the offer, it will still incur fixed costs of $6,127, but it will be able to lease the resources that will become available from not making the part for $2,600. At what production level would X Company be indifferent between making and buying the part next year?

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