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The nick company has offered to sell cari 10000 units of y2

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Reference no: EM13587403

Cari manufactures a unit called Y2. Variable manufacturing costs per unit of Y2 are as follows:

Direct materials

$2

Direct labor

$20

Variable manufacturing overhead

$10

The Nick Company has offered to sell Cari 10,000 units of Y2 for $44 per unit. If Cari accepts the offer, $140,000 of fixed manufacturing overhead will be eliminated.

Applying differential analysis to the situation, what should Cari do?

Reference no: EM13587403

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