What is the maximum price that Menden Company should be willing to pay the outside supplier for each unit of part B52?
 

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Menden Company manufactures part B52 used in several of its engine models. Monthly production costs for 10,000 units are as follows: Variable support Direct materials $ 80,000 Direct labor 20,000 50,000 40,000 $190,000 costs Fixed support costs Total costs It is estimated that 20% of the fixed support costs assigned to part B52 will no longer be incurred if the company purchases the part from the outside supplier. Menden Company has the option of purchasing the part from an outside supplier at $16 per unit. Menden Company manufactures part B52 used in several of its engine models. Monthly production costs for 10,000 units are as follows: Variable support Direct materials $ 80,000 Direct labor 20,000 50,000 40,000 $190,000 costs Fixed support costs Total costs It is estimated that 20% of the fixed support costs assigned to part B52 will no longer be incurred if the company purchases the part from the outside supplier. Menden Company has the option of purchasing the part from an outside supplier at $16 per unit.