ABC Company makes 40,000 units per year of a part it uses in the products...
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ABC Company makes 40,000 units per year of a part it uses in the products it manufactures. The per unit product cost of this part is shown below direct materials. $15.30 .. direct labor .. allocated fixed overhead 10.70 An outside supplier has offered to sell ABC Company 40,000 units of this part a year for $60.70 per unit. If ABC Company accepts this offer, the facilities now being used to make this part could be used to make more units of a product that is in high demand. The additional contribution margin that could be earned on this other product would be $100,000 per year Calculate the increase in company profits if ABC Company accepts the outside suppliers offer. Do not use decimals or type the word increase after your
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