Business, 25.12.2019 03:31 halimomohamed
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: variable production cost $ 16 fixed production cost 20 unit product cost $ 36 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.
if the parts are purchased from the outside supplier, what is the annual impact on the company's operating income?
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