3 Outdoor Life manufactures snowboards. Its cost of making 1,800 bindings is as follows: Direct materials 5 17,530 Direct labor 2,700 Variable overhead 2,120 Fixed overhead 7,100 Total manufacturing costs for 1,800 bindings Suppose Lancaster will sell bindings to Outdoor Life for $15 each. Outdoor Life would pay $1 per unit to transport the bindings to its manufacturing plant, where it would add its own logo at a cost of $0.60 per binding. Requirements 1. Outdoor Life's accountants predict that purchasing the bindings from Lancaster will enable the company to avoid $2,600 of fixed overhead. Prepare an analysis to show whether Outdoor Life should make or buy the bindings. 2. The facilities freed by purchasing bindings from Lancaster can be used to manufacture another product that will contribute $2,600 to profit. Total xed costs will be the same as if Outdoor Life had produced the bindings. Show which alternative makes the best use of Outdoor Life's facilities: (a) make bindings, (b) buy bindings and leave facilities idle, or (0) buy bindings and make another product