Multiple Choice
Answer the following question(s) using the information below.Schmidt Corporation produces a part that is used in the manufacture of one of its products.The costs associated with the production of 10,000 units of this part are as follows:
Of the fixed factory overhead costs, $30,000 is avoidable.
-Assuming accepting the offer creates excess facility capacity that can be used to produce 2,000 units of another product that has a unit selling price of $24, variable costs of $12, and fixed cost allocation of $3.What is the highest price that Schmidt should be willing to pay Phil Company for 10,000 units of the part?
A) $146,000
B) $164,000
C) $152,000
D) $134,000
E) $140,000
Correct Answer:

Verified
Correct Answer:
Verified
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