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What are the fixed overhead costs of making the component

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Reference no: EM133078589

Question - Waterway's Shop can make 1000 units of a necessary component with the following costs:

Direct Materials $25000

Direct Labor 6000

Variable Overhead 3000

Fixed Overhead ?

The company can purchase the 1000 units externally for $43000. The unavoidable fixed costs are $2000 if the units are purchased externally. An analysis shows that at this external price, the company is indifferent between making or buying the part. What are the fixed overhead costs of making the component?

Reference no: EM133078589

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