Sharp Corporation produces 8,000 parts each year,which are used in the production of one of its products.The unit product cost of a part is $36,computed as follows:
The parts can be purchased from an outside supplier for only $28 each.The space in which the parts are now produced would be idle and fixed production costs would be reduced by one-fourth.Based on these data,the financial advantage (disadvantage)of purchasing the parts from the outside supplier would be:
A) $24,000
B) ($24,000)
C) $56,000
D) ($56,000)

Question

Sharp Corporation produces 8,000 parts each year,which are used in the production of one of its products.The unit product cost of a part is $36,computed as follows:
 The parts can be purchased from an outside supplier for only $28 each.The space in which the parts are now produced would be idle and fixed production costs would be reduced by one-fourth.Based on these data,the financial advantage (disadvantage)of purchasing the parts from the outside supplier would be:
A) $24,000 
B) ($24,000) 
C) $56,000 
D) ($56,000)

Quizplus · Accepted Answer

11ea7761_15f5_bac3_81a5_57e6b139a317_TB2580_00

Sharp Corporation Produces 8,000 Parts Each Year,which Are Used in the Production