Billings company has the following costs when producing, Ask an Expert

Accounting

Billings company has the following costs when producing 100,000 units:

variable costs $800,000
Fixed costs $1,200,000

An outside supplier has offered to make the item at $6 a unit. If the decision is made to purchase the item outside, current production facilities could be leased to another company for $220,000. What is the net increase (decrease) in the net income of accepting the suppliers offer?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9986691

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