Calculate the breakeven bid to outsource component

Reference no: EM13143477

The following cost card was found in the Inventory ledger for part AAA. Direct Materials $600, 20 hours of Direct Labor at $20 per hour $400, manufacturing overhead is applied at $15 per direct labor hour, one third of the overhead is fixed the rest is variable. Calculate the breakeven bid to outsource this component?

a. $1200

b. $1100

c. $1300

d. $800

e. None of the above are correct.

Reference no: EM13143477

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