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XYZ Corporation produces 48, 000 videophones per year. The company estimates its direct material costs for the videophone to be $310 per unit and its
XYZ Corporation produces 48, 000 videophones per year. The company estimates its direct material costs for the videophone to be $310 per unit and its conversion (direct labor plus support) costs to be $350 per unit. Annual inventory carrying costs, not included in these costs, are estimated to be 9%. XYZ's average inventory levels are estimated as follows: Requirement Compute the annual inventory carrying costs for XYZ Corporation
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