Managerial Accounting

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Relevant Costs

MGRACT-GLPV54

In deciding whether to manufacture a part or buy it from an outside vendor, a cost that is irrelevant to the short-run decision is:

A

Direct labor

B

Variable overhead

C

Fixed overhead that will be avoided if the part is bought from an outside vendor

D

Fixed overhead that will continue even if the part is bought from an outside vendor