3.30 Make-or-Buy Decision Somerset Computer Company has been purchasing carrying cases for its portable computers at a purchase price of 58 per unit. The company, which is currently operating below full capacity, charges factory overhead to production at the rate of 36% of direct labor cost. The unit costs to produce comparable carrying cases are expected to be as follows: Direct materials Direct labor 17 Factory overhead (36% of direct labor) 6.12 Total cost per unit $53.12 IT Somerset Computer Company manufactures the carrying cases, fed factory overhead costs will not increase and variable factory overhead casts associated with the cases are expected to be 16% of the direct labor costs. a. Prepare a differential analysis dated April 30 to determine wnether the company should make (Alternative 1) or buy fAlternative 2) the carrying case. Ir required, round your answers to two decimal places. If an amount is zero, enter" Differential Analysis Make Carrying Case (Alt. 1) or Buy Carrying Case (Alt. 2) April 30 Make Buy Carrying Carrying Case Case (Alternative 1) (Alternative 2) Differential Effects (Alternative 2) Unit costs: Purchase price 58 April 30 Make Buy Carrying Carrying Case (Alternative 1) (Alternative 2) Case Differential Effects (Alternative 2) Unit costs: Purchase price 07 58 58 Direct materials 30 07 30 Direct labor 17 -17 0 0 Variable factory overhead 2.72 2.72 Fixed factory overhead 5 X 0 Total unit costs 6.01 X 0 X Che W to manufacture the carrying cases. Fixed factory b. Assuming there were no better alternative uses for the spare capacity, it would be advisable overhead is irrelevant to this decision