Manor, Inc. currently manufactures 1,000 subcomponents per month in one of its factories. The unit costs to produce the subcomponents are: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total unit cost Manor is considering purchasing the subcomponents from an outside supplier, who normally charges $379 per unit. The supplier also has an "Exclusive Buyer's Club" which costs $30,000 per month to join, but whose members can purchase the subcomponents for $329 per unit. Fixed overhead is not avoidable. How many units would Manor need to order per month to make it worth it to join the "Exclusive Buyer's Club"? Multiple Choice 2.522 3,000 2.786 Per unit $ 65 173 101 129 $468 3,349

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Manor, Inc. currently manufactures 1,000 subcomponents per month in one of its factories. The unit costs to
produce the subcomponents are:
Direct materials
Direct labor
Variable manufacturing overhead
Fixed manufacturing overhead
Total unit cost
Manor is considering purchasing the subcomponents from an outside supplier, who normally charges $379
per unit. The supplier also has an "Exclusive Buyer's Club" which costs $30,000 per month to join, but
whose members can purchase the subcomponents for $329 per unit. Fixed overhead is not avoidable. How
many units would Manor need to order per month to make it worth it to join the "Exclusive Buyer's Club"?
Multiple Choice
O
2.522
3,000
2,786
Per unit
$65
173
101
129
$468
3.349
Transcribed Image Text:Manor, Inc. currently manufactures 1,000 subcomponents per month in one of its factories. The unit costs to produce the subcomponents are: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total unit cost Manor is considering purchasing the subcomponents from an outside supplier, who normally charges $379 per unit. The supplier also has an "Exclusive Buyer's Club" which costs $30,000 per month to join, but whose members can purchase the subcomponents for $329 per unit. Fixed overhead is not avoidable. How many units would Manor need to order per month to make it worth it to join the "Exclusive Buyer's Club"? Multiple Choice O 2.522 3,000 2,786 Per unit $65 173 101 129 $468 3.349
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