O decrease by $1,000 O decrease by $4,000 O increase by $1,000 O increase by $3,500
O decrease by $1,000 O decrease by $4,000 O increase by $1,000 O increase by $3,500
Chapter10: Short-term Decision Making
Section: Chapter Questions
Problem 6PA: Gent Designs requires three units of part A for every unit of Al that it produces. Currently, part A...
Related questions
Question
![You make component X72 in-house at a unit cost
of $16/unit, which consists of direct materials
$7/unit, direct labor $3/unit, variable overhead
$1/unit, and fixed overhead $5/unit. An outside
supplier offered to manufacture component X72
for you at a wholesale price of $12 per unit. You
need 1,000 units per month. If you outsource the
production of X72, how much will your profit
change in the short term?
O decrease by $1,000
O decrease by $4,000
O increase by $1,000
increase by $3,500
O increase by $12,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff70ac400-ca2b-42e3-9688-f7f5894bc9ea%2F388652ae-c8fd-4916-9d74-b07bc91d2c0e%2F8mbpy4_processed.jpeg&w=3840&q=75)
Transcribed Image Text:You make component X72 in-house at a unit cost
of $16/unit, which consists of direct materials
$7/unit, direct labor $3/unit, variable overhead
$1/unit, and fixed overhead $5/unit. An outside
supplier offered to manufacture component X72
for you at a wholesale price of $12 per unit. You
need 1,000 units per month. If you outsource the
production of X72, how much will your profit
change in the short term?
O decrease by $1,000
O decrease by $4,000
O increase by $1,000
increase by $3,500
O increase by $12,000
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