Questions 3 and 4 refer to the following information: X Company is considering buying a...

70.2K

Verified Solution

Question

Accounting

image
Questions 3 and 4 refer to the following information: X Company is considering buying a part in 2020 that it has been making for the past several years. A company has offered to supply this part for $17.20 per unit. Budgeted production in 2020 is 56,000 units, and budgeted per-unit production costs are: S6.20 5.60 Materials Direct labor (all variable) Total overhead Total 5.40 $17.20 $100,800 of X Company's total overhead costs are fixed; $79,632 of the $100,800 are unavoidable even if it buys the part Also, if X Company buys the part, it can rent the equipment that was used to make the part to another company for $70,000 8 pts. If X Company continues to make the part instead of buying it, it will save 3. AO $8,112 BO 89,491 CO $11,101 DO $12,992 EO $15,201 FO $17.785 8 pt. At what production level would X company be indifferent between making and buying the part? 4. A 49,015 BO 55,387 CO 62,587 DO 70,724 E 79,918 FO 90,307

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