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Sunland Toys can make 5500 toy robots with the following costs: Direct Materials $75000 Direct Labour 29400 Variable Overhead 23500 Fixed Overhead 14500 The company can purchase the 5500 robots externally for $145000. The avoidable fixed costs are $14500 if the units are purchased externally. What is the cost savings if the company makes the robots? $2600 $6400 $14500 $17100

Sunland Toys can make 5500 toy robots with the following costs: Direct Materials $75000 Direct Labour 29400 Variable Overhead 23500 Fixed Overhead 14500 The company can purchase the 5500 robots externally for $145000. The avoidable fixed costs are $14500 if the units are purchased externally. What is the cost savings if the company makes the robots? $2600 $6400 $14500 $17100

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Sunland Toys can make 5500 toy robots with the following costs: Direct Materials $75000 Direct Labour 29400 Variable Overhead 23500 Fixed Overhead 14500 The company can purchase the 5500 robots externally for $145000. The avoidable fixed costs are $14500 if the units are purchased externally. What is the cost savings if the company makes the robots? $2600 $6400 $14500 $17100
Transcribed Image Text:Sunland Toys can make 5500 toy robots with the following costs: Direct Materials $75000 Direct Labour 29400 Variable Overhead 23500 Fixed Overhead 14500 The company can purchase the 5500 robots externally for $145000. The avoidable fixed costs are $14500 if the units are purchased externally. What is the cost savings if the company makes the robots? $2600 $6400 $14500 $17100
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