Sage Company Is Operating at 90% of Capacity and Is

question 136

Multiple Choice

Sage Company is operating at 90% of capacity and is currently purchasing a part used in its manufacturing operations for $15 per unit.The unit cost for the business to make the part is $20,including fixed costs,and $11,not including fixed costs.If 30,000 units of the part are normally purchased during the year but could be manufactured using unused capacity,what would be the amount of differential cost increase or decrease from making the part rather than purchasing it?

• A) $150,000 cost increase
• B) $120,000 cost decrease
• C) $150,000 cost increase.
• D) $120,000 cost increase

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Definitions:

Exercise Regularly

The practice of engaging in physical activity on a routine basis to improve or maintain one's fitness and overall health.

Stroke Volume

The volume of blood the heart's left ventricle ejects with a single beat.

Blood Pumped

Describes the process of the heart moving blood throughout the body's circulatory system.

Cardiorespiratory Fitness

The ability of the heart, lungs, and vascular system to supply oxygen-rich blood to working muscles during sustained physical activity.