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X Company is considering buying a part next year that it has been making for the past several years. A company has offered to supply
X Company is considering buying a part next year that it has been making for the past several years. A company has offered to supply this part for $14.75 per unit. Budgeted production next year is 59,000 units, and budgeted production costs per-unit are: Materials $5.80 Direct labor 4.50 Total overhead 4.30 Total $14.60 $88,500 of X Company's total overhead costs are fixed; $70,800 of the $88,500 are unavoidable even if it buys the part. Ir X Company continues to make the part instead of buying it next year, it will save
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