Sam's Manufacturing Company can make 100 units of a necessary component part with the following...
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Accounting
Sam's Manufacturing Company can make 100 units of a necessary component part with the following costs:
Direct materials $80,000
Direct labor $13,000
Variable overhead $40,000
Fixed overhead $27,000
If Sam's manufacturing company can purchase the component externally for $145,000 and only $4,000 of the fixed costs can be avoided, what is the correct "make or buy" decision?
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