Question: Smith Data makes flash drives and sells to Staples. Their cost data for 15,000 drives per year follows: Direct Materials $15,000 Direct Labor $30,000 Fixed

Smith Data makes flash drives and sells to Staples. Their cost data for 15,000 drives per year follows:

Direct Materials $15,000

Direct Labor $30,000

Fixed MOH $30,000

Total Cost $75,000

Total Cost Per Unit $5

Johnson Industries Inc has offered to make 15,000 flash drives for Smith Data at $4 per unit. If Smith Data accepts this Buy vs Make Decision their fixed MOH will remain unchanged over the intermediate term as it relates to lease obligations,equipment deprecation and property taxes.

If Smith Data outsources the manufacture of flash drives to Johnson Industries what will its new total cost to manufacture the 15,000 flash drives be? Do not use dollar signs ($) in your answer but provide commas where appropriate.

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