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5. Sheffield Toys can make 5200 toy robots with the following costs: Direct Materials $74800 Direct Labour 30900 Variable Overhead 23500 Fixed Overhead 14400 The

5. Sheffield Toys can make 5200 toy robots with the following costs:

Direct Materials $74800

Direct Labour 30900

Variable Overhead 23500

Fixed Overhead 14400

The company can purchase the 5200 robots externally for $145300. The avoidable fixed costs are $14400 if the units are purchased externally. What is the cost savings if the company makes the robots?

$16100

$14400

$1700

$7400

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