Question: Sanchoz Semiconductor produces 200,000 high-och computer chips per month Each chip uses a component that Sanchez makes in-house. The variable to make the component are
Sanchoz Semiconductor produces 200,000 high-och computer chips per month Each chip uses a component that Sanchez makes in-house. The variable to make the component are $1.30 per unit, and the fixed costs are 51.100.00000 per month The company has been approached by a foreign producer who can supply the component within cceptable quality standard for 51 20 each of the company choose to outsourco, fed costs can be reduced by Co There are no merases for the curtery employed in making the component What would be the effect on operating income, if the company decides to outsource? O A There would be no effect on operating income B Operating income would increase by $570,000.00 C. Operating income would increase by $240,000.00 OD Operating income would decrease by $20.000,00
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