BestSystems manufactures an optical switch that it uses in its final product. BestSystems incurred the following manufacturing costs when it produced 67,000 units last year: EEl (Click the icon to view the manufacturing costs.) BestSystems does not yet know how many switches it will need this year, however, another company has offered to sell BestSystems the switch for $17.50 per unit. If BestSystems buys the switch from the outside supplier, the manufacturing facilities that will be idle cannot be used for any other purpose, yet none of the fixed costs are avoidable. Read the requirements. 14.50$ 17.50 $ (3.00 Total variable cost per unit Decision: Make the optical switch because the variable cost per unit to make the switch is lessthan the variable cost per unit to buy the switch. Requirement 2. Now, assume that BestSystems can avoid $104,000 of fixed costs a year by outsourcing production. In addition, because sales are increasing, BestSystems needs 72,000 switches a year rather than 67,000 switches. What should the company d o now? Complete an outsourcing decision analysis assuming fixed costs can be avoided by outsourcing production and the number of units needed have increased. Data Table Requirements Make Buy switches switches Direct materials Direct labor Variable MOH Fixed MOH Total manufacturing cost for 67,000 units S 737,00 100,50 134,00 402,00 S 1,373,50 Variable cost per unit 1. Given the same cost structure, should BestSystems make or buy the switch? Show your analysis. 2. Now, assume that BestSystems can avoid S104,000 of fixed costs a year by outsourcing production. In addition, because sales are increasing, BestSystems needs 72,000 switches a year rather than 67,000 switches. What should the company d o now? 3. Given the last scenario, what is the most BestSystems would be willing to pay Total relevant costs to outsource the switches? PrintDone Choose from any list or enter any number in the input fields and then cl Print Done