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X Company is considering buying a part next year that it currently makes. A company has offered to supply this part to X Company for
X Company is considering buying a part next year that it currently makes. A company has offered to supply this part to X Company for $17.06 per unit. Per-unit production costs last year, when production was 58,000 units, were: Materials $7.00 5.30 Direct labor Total overhead Total 4.80 $17.10 $110,200 of X Company's total overhead costs were fixed; $81,548 of these fixed costs are unavoidable even if it buys the part. If X Company buys the part, there is nothing it can do with the resources that will become idle. Production next year is expected to be 62,750 units. If X Company continues to make the part instead of buying it next year, it will save
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