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What price the company indifferent between making or buying

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Reference no: EM131799073

Tex's Manufacturing Company can make 100 units of a necessary component part with the following costs:

Direct Materials $120,000
Direct Labor 25,000
Variable Overhead 45,000
Fixed Overhead 30,000

If Tex's Manufacturing Company purchases the component externally, $20,000 of the fixed costs can be avoided. At what external price for the 100 units is the company indifferent between making or buying?

Reference no: EM131799073

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