Sheridan Music produces 60800 blank CDs on which to record music. The CDs have the...
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Accounting
Sheridan Music produces 60800 blank CDs on which to record music. The CDs have the following costs: Direct Materials $10400 Direct Labour 15400 Variable Overhead 3400 Fixed Overhead 7100 None of Sheridans fixed overhead costs can be reduced, but another product could be made that would increase profit contribution by $4400 if the CDs were acquired externally. If cost minimization is the major consideration and the company would prefer to buy the CDs, what is the maximum external price that Sheridan would be willing to accept to acquire the 60800 units externally?
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