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The question is located in the image provided. The question is located in the image...

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Accounting

The question is located in the image provided. The question is located in the image provided

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CoursHeroTranscribedText: Senior Company currently buys 35,000 units of a part used to manufacture its product at $40 per unit. Recently the supplier informed Senior Company that a 20 percent increase will take effect next year. Senior has some additional space and could produce the units for the following per-unit costs (based on 35,000 units): Direct materials 316 Direct labor 12 Variable overhead 12 Fixed overhead E Total $5 0 If the units are purchased from the supplier, $200,000 of xed costs will continue to be incurred. In addition, the plant can be rented out for $20000 per year if the parts are purchased externally. R_equired: Should Senior Company buy the part externally or make it internally? Explain and support you: answer with calculations

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