Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. foto company makes 60,000 units per year of a part

Foto Company makes 60,000 units per year of a part it uses in the products...

70.2K

Verified Solution

Question

Accounting

image

Foto Company makes 60,000 units per year of a part it uses in the products it manufactures. The cost per unit of this part is shown below: direct materials direct labor variable overhead allocated fixed overhead total $13.00 10.10 5.60 9.50 $38.20 An outside supplier has offered to sell Foto Company 60,000 of these parts for $31.60 per unit. If Foto Company accepts this offer, the facilities now being used to make the part could be used to make more units of a product that is in high demand. The additional contribution margin earned on this other product would be $120,000 per year. Calculate the selling price per unit charged by the outside supplier that would make Foto economically indifferent between making and buying the part

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students