Question: Unit cost Direct materials $15.70 Direct Labor 17.50 Variable manufacturing overhead 4.50 Fixed manufacturing overhead 14.60 Total unit product cost =$52.30 Company can buy the

Unit cost Direct materials $15.70 Direct Labor 17.50 Variable manufacturing overhead 4.50 Fixed manufacturing overhead 14.60 Total unit product cost =$52.30 Company can buy the part for 51.90. if the company accepts, the facilities will be used to make a product that is in high demand. The additional contribution margin on the other product is $219,000. If purchased, all of direct labor cost would be avoided. However, $6.20 of fixed manufacturing overhead cost being applied to part would continue even if purchased. The fixed manufacturing overhead cost would be applied to company's remaining products

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