Use the Following Information for Questions
Ortiz Co If Ortiz Buys the Part from an Outside Supplier, $40,000

question 32

Multiple Choice

Use the following information for questions
Ortiz Co. produces 5,000 units of part A12E. The following costs were incurred for that level of production: $$\begin{array} { l r } \text { Direct materials } & \$ 55,000 \\\text { Direct labor } & 160,000 \\\text { Variable overhead } & 75,000 \\\text { Fixed overhead } & 175,000\end{array}$$ If Ortiz buys the part from an outside supplier, $40,000 of the fixed overhead is avoidable.
-If the outside supplier offers a unit price of $68, net income will increase (decrease) by

• A) $(10,000).
• B) $125,000.
• C) $(50,000).
• D) $85,000.

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Directing

The process of guiding, commanding, or controlling a group or an individual to achieve desired goals or tasks.

Challenging

Presenting a task or problem that is difficult to solve or requiring effort to overcome.

Confrontational Responses

Refers to direct and often forceful verbal reactions aimed at challenging or opposing someone's actions or opinions.

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