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Business, 23.10.2019 20:30 krojas015

Blue ridge bicycles uses a standard part in the manufacture of several of its bikes. the cost of producing 43,000 parts is $142,000, which includes fixed costs of $68,000 and variable costs of $74,000. the company can buy the part from an outside supplier for $3.60 per unit, and avoid 30% of the fixed costs. assume that factory space freed up by purchasing the part from an outside source can be used to manufacture another product that can be sold for $14,000 profit. if blue ridge bicycles makes the part, what will its operating income be?

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