Blue Ridge Bicycles uses a standard part in the manufacture of several of its bikes....
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Blue Ridge Bicycles uses a standard part in the manufacture of several of its bikes. The cost of producing 40,000 parts is $143,000, which includes fixed costs of $70,000 and variable costs of $73,000. The company can buy the part from an outside supplier for $3.70 per unit, and avoid 30 % of the fixed costs. Assume that factory space freed up by purchasing the part from an outside source can be used to manufacture another product that can be sold for $13,000 profit. If Blue Ridge Bicycles makes the part, what will its operating income be? OA $41,000 less than if the company bought the part O B. $67,000 greater than if the company bought the part O C. $184,000 greater than if the company bought the part D. $41,000 greater than if the company bought the part
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