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Paxton Company can produce a component of its product that incurs the following costs per unit: direct materials $10.30 direct labor $14.30 variable overhead $3.30 and fixed overhead

Paxton Company can produce a component of its product that incurs the following costs per unit: direct materials, $10.30; direct labor, $14.30, variable overhead $3.30 and fixed overhead, $8.30. An outside supplier has offered to sell the product to Paxton for $36.20. Compute the net incremental cost or savings of buying the component. Answers: (A) $3.30 savings per unit. (B) $3.30 cost per unit. (C) $0 cost or savings per unit. (D) $8.30 savings per unit. (E) $8.30 cost per unit.

Jun 22 2020 View more View Less

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