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X Company is considering buying a part next year that they currently make. A company has offered to supply this part for $10.92 per unit.
X Company is considering buying a part next year that they currently make. A company has offered to supply this part for $10.92 per unit. X Company would have to inspect cach part at a cost of 80.40 per unit. This year's production costs for 10,750 units of this part were: Total Per- Unit S25,018 $2.33 832,572 $3.03 Cost Item Materials Direct labor Variable overhead 847,730 84.44 Fixed overhead $38,485 $3.58 IFX Company buys the part, 18,088 of the fixed overhead can be avoided; the rest is unavoidable. In addition, if X Company buys the part, it can rent out the facilities that it currently uses to make the part and receive 85,400 per year Estimated production next year is also expected to be 10,750 units If X Company buys the part t save Tries 0/3 2. X Company is concernod that noxt ycar's demand may be different than this year's demand. At what level of demand will X Company be indifferent between aking and buying? tries 0/3
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