The Camel Company produces 10,400 units of item Roto 454 annually at a total cost of $197,600.

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Direct materials $ 20,800 Direct labor 57,200 Variable overhead 46,800 Fixed overhead 72,800 Total $ 197,600

The Yukon Company has offered to supply 10,400 units of Roto 454 per year for $18 per unit. If Camel accepts the offer, $4 per unit of the fixed overhead would be saved. In addition, some of Camel's facilities could be rented to a third party for $17,680 per year. At what price would Camel be indifferent to Yukon's offer?

Posted Date: May 18, 2024 04:05 AM

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The Camel Company produces 10,400 units of item Roto 454 annually at a total cost of $197,600.

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