The Ted Company is considering eliminating the following product line: Product AXP Sales$50,000 Less...
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Accounting
The Ted Company is considering eliminating the following product line:
| Product AXP | |
| Sales | $50,000 |
| Less variable costs: | |
| Raw materials | 30,000 |
| Direct labor | 9,000 |
| Contribution margin | $11,000 |
| Less fixed costs: | |
| Production costs allocated to products | 17,000 |
| Profit (loss) | $(6,000) |
What amount of cost is avoidable if Ted outsources production of this product?
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