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Business, 16.03.2020 21:51 sainijasdeep27
Laskowski Company manufactures a part for its production cycle. The annual costs per unit for 5,000 units of the part are as follows: Per Unit Direct materials $3.00 Direct labor 5.00 Variable factory overhead 4.00 Fixed factory overhead 2.00 Total costs $14.00 The fixed factory overhead costs are unavoidable. Hendricks Company has offered to sell 5,000 units of the same part to Laskowski Company for $14 per unit. The facilities currently used for the part could be used to make 5,000 units annually of a new product that would contribute $5 a unit to fixed expenses. No additional fixed costs would be incurred with the new product. Laskowski Company should . A) make the part to save $5,000 B) make the part to save $15,000 C) make the new product and buy the part to save $5,000 D) make the new product and buy the part to save $15,000
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Laskowski Company manufactures a part for its production cycle. The annual costs per unit for 5,000...
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