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X Company is considering buying a part next year that they currently make. A company has offered to supply it for $13.74 per unit. This
X Company is considering buying a part next year that they currently make. A company has offered to supply it for $13.74 per unit. This year's production costs for 3,200 units were as follows: Direct materials Direct labor Total overhead Total costs Per-Unit $3.66 4.39 8.70 $16.75 Total $11,712 14,048 27,840 $53,600 $18,560 of total overhead is fixed. If X Company chooses to buy the part, it will avoid fixed costs of $10,765. 1. If X Company buys the part next year instead of making it, and production is expected to remain at 3,200 units, it will save Submit Answer Tries 0/3 2. If X Company buys the part next year instead of making it, and production next year is expected to be 3,600 units, it will save Submit Answer Tries 0/3
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