You manufacture 30,768 clay pots a year for your indoor plant store at the following cost per unit: Direct materials: $3.60 Direct labor: $8.00 Variable OH: $2.40 Fixed OH: $12.00 An outside supplier has offered to make the clay pots for you for $20 a unit plus $1 of shipping per unit. If you accept this, the facilities that are now being used to make the clay pots could be rented for $80,074. You have determined that  of fixed overhead is related to common overhead and will continue if the clay pots are bought. 

What is the total annual advantage/disadvantage of buying the clay pots? (Put a - sign in front of your number if it is a disadvantage.)

Answer rating: 100% (QA)

To calculate the total annual advantage or disadvantage of buying the clay pots from the outside sup... View the full answer