Sutton Inc. can produce 100 units of a component part with the following costs: $$\begin{array} { l r }
\text { Direct Materials } & \$ 130,000 \
\text { Direct Labor } & 103,000 \
\text { Variable Overhead } & 82,000 \
\text { Fixed Overhead } & 62,000
\end{array}$$ If Sutton Inc. can purchase the units externally for $300000 by what amount will its total costs change?
A) An decrease of 67000
B) An increase of $15000
C) An increase of $135000
D) A decrease of $47000

Question

Sutton Inc. can produce 100 units of a component part with the following costs: $$\begin{array} { l r } 
\text { Direct Materials } & \$ 130,000 \
\text { Direct Labor } & 103,000 \
\text { Variable Overhead } & 82,000 \
\text { Fixed Overhead } & 62,000
\end{array}$$ If Sutton Inc. can purchase the units externally for $300000 by what amount will its total costs change?
A) An decrease of 67000
B) An increase of $15000
C) An increase of $135000
D) A decrease of $47000

Quizplus · Accepted Answer

The Answer of Sutton Inc. can produce 100 units of a component part with the following costs: $$\begin{array} { l r } 
\text { Direct Materials } & \$ 130,000 \
\text { Direct Labor } & 103,000 \
\text { Variable Overhead } & 82,000 \
\text { Fixed Overhead } & 62,000
\end{array}$$ If Sutton Inc. can purchase the units externally for $300000 by what amount will its total costs change?
A) An decrease of 67000
B) An increase of $15000
C) An increase of $135000
D) A decrease of $47000

Sutton Inc If Sutton Inc