Required Information The Foundational 15(Algo)[LO11-2, LO11-3, LO11-4, LO11-5, LO11-6] [The following information...

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Accounting

Required Information
The Foundational 15(Algo)[LO11-2, LO11-3, LO11-4, LO11-5, LO11-6]
[The following information applles to the questions displayed below.]
Cane Company manufactures two products called Alpha and Beta that sell for $165 and $130, respectively. Each product
uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 113,000
units of each product. Its average cost per unit for each product at this level of activity are given below:
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses
are unavoidable and have been allocated to products based on sales dollars.
Foundational 11-10(Algo)
Assume that Cane expects to produce and sell 59,000 Alphas during the current year. A supplier has offered to manufacture and
deliver 59,000 Alphas to Cane for a price of $116 per unit. What is the financial advantage (disadvantage) of buying 59,000 units from
the supplier instead of making those units?
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