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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: Direct materials
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: Direct materials Direct labor Variable overhead Fixed overhead Total Per-Unit $3.31 4.01 2.90 3.10 $13.32 Total $11,254 13,634 9,860 10,540 $45,288 A company has offered to supply this part to X Company for $13.46 per unit. If X Company accepts the offer, it will avoid fixed costs of $5,059, and it will be able to lease the resources that will become available from not making the part for $2,700. At what production level would X Company be indifferent between making and buying the part next year
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