Swifty Corporation incurs the following costs to produce 8600 units of a subcomponent: Direct materials $7224 Direct labor 9718 Variable overhead 10836 Fixed overhead 16200 An outside supplier has offered to sell Swifty the subcomponent for $2.85 a unit. If Swifty could avoid $3000 of fixed overhead by accepting the offer, net income would increase (decrease) by

increased by $6,268

Explanation:

The computation of the change in the net income is shown below:

Particulars              Make                Buy                 Difference

Direct materials     $7,224                $0                  $7,224

Direct labor            $9,718                 $0                  $9,718

Variable overhead $10,836            $0                   $10,836

Fixed overhead      $16,200            $13,200          $3,000

Purchase price

(8,600 units × $2.85) $0                 $24,510         -$24,510

Change in income  $43,978            $37,710           $6268

Net income would increased by $6,268 if the order is accepted

the specific actions take by the fed. what the fed was attempting to do by taking these actions. the result of the actions taken by the fed