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Direct materials Direct labor Variable overhead Fixed overhead $ 55,000 160,000 75,000 175,000 Ortiz Co....

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Accounting

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Direct materials Direct labor Variable overhead Fixed overhead $ 55,000 160,000 75,000 175,000 Ortiz Co. produces 5,000 units of part A12E. The following costs were incurred for that level of production: If Ortiz buys the part from an outside supplier, $40,000 of the fixed overhead is avoidable. If the outside supplier offers a unit price of $68, net income will increase (decrease) by O $(10,000). O$125,000. O $(50,000). O $85,000

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