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20. The part X10 is used in the production of one of the products manufactured by Jemo Company. Each year, a total of 50.000 units of this part are produced and used. The costs of producing the part X10 at this level of activity are shown in the below table. An outside supplier has offered to sell the company the needed units from this part for $58.50 each. If this offer is accepted, the facilities that are used in making the part may be utilized to make more units from a product that is highly demanded, which in turn, will lead to an additional contribution margin of $450.000 per year on this other product. If the part X10 is purchased from the outside supplier, its direct labor cost will be avoided, but $9.50 of the fixed manufacturing overhead cost that is being applied to this part will continue, and hence, this fixed manufacturing overhead cost will be applied to the company's other products. If the outside supplier commits to provide the needed 50,000 units of the part X10 per year, what is the maximum acceptable purchase price that Jemo Company may be willing to pay to the outside supplier per unit of this part? * Item Direct Materials Direct Labor Variable Manufacturing Overhead Fixed Manufacturing Overhead Amount $18.25 per unit $19.75 per unit $5.50 per unit $16.00 per unit $50.00 per unit $58.50 per unit $59.00 per unit $59.50 per unit None of the above

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