The Ted Company is considering eliminating the following product line:
| Product AXP |
| Sales |
$42,000 |
| Less variable costs: |
|
| Raw materials |
26,000 |
| Direct labor |
5,800 |
| |
| Contribution margin |
$10,200 |
| Less fixed costs: |
|
| Production costs allocated to products |
15,400 |
| |
| Profit (loss) |
$(5,200) |
What amount of cost is avoidable if Ted outsources production of this product?