Deer currently manufactures a subcomponent that is used in its main product. A supplier has offered to supply all the su

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answerhappygod
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Deer currently manufactures a subcomponent that is used in its main product. A supplier has offered to supply all the su

Post by answerhappygod »

Deer currently manufactures a subcomponent that is used in its
main product. A supplier has offered to supply all the
subcomponents needed at a price of $37.00. Deer currently produces
10,000 subcomponents at the following manufacturing costs: Per unit
Direct materials $ 10.30 Direct labor 7.60 Variable manufacturing
overhead 3.80 Fixed manufacturing overhead 1.90 Unit cost $ 23.60
a. If Deer has no alternative uses for the manufacturing capacity,
what would be the profit impact of buying the subcomponents from
the supplier?
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