*(b) Would your answer be different if the released productive capacity will generate additional income of $50,128? (If amount decreases net income then enter the amount using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) Make Buy Net Income Increase (Decrease) Total Cost Opportunity cost Total cost the answer is . The analysis shows that net income will be Attempts: 0 of 15 used *Do It! Review 7-3 (Part Level Submission) Pina Company must decide whether to make or buy some of its components. The costs of producing 65,700 switches for its generators are as follows. Direct materials Direct labor $31,000 $34,229 Variable overhead Fixed overhead $45,900 $84,000 Instead of making the switches at an average cost of $2.97 ($195,129 - 65,700), the company has an opportunity to buy the switches at $2.71 per unit. If the company purchases the switches, all the variable costs and one-fourth of the fixed costs will be eliminated. *(a) Your answer is correct. Prepare an incremental analysis showing whether the company should make or buy the switches. (If amount decreases net income then enter the amount using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) Buy Make $31,000 Direct materials Net Income Increase (Decrease) $31,000 34,229 34,229 45.900 Direct labor Variable manufacturing costs Fixed manufacturing costs Purchase price 45,900 184,000 00 $63,000.00 1178047 S$241047 21,000.00 7-178047 Total cost $1195129 $E$45,918.00 Pina Company will incur $ 45,918 of additional costs if it buys the switches Attempts: 5 of 15 used *(b)