Tex's Manufacturing Company can make 100 units of a necessary component part with the following costs:
Direct Materials |
$120,000 |
Direct Labor |
25,000 |
Variable Overhead |
45,000 |
Fixed Overhead |
30,000 |
If Tex's Manufacturing Company purchases the component externally, $20,000 of the fixed costs can be avoided. At what external price for the 100 units is the company indifferent between making or buying?