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Brief Exercise 169 Notson, Inc. produces several models of clocks. An outside supplier has offered to produce the commercial clocks for Notson for $420 each.

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Brief Exercise 169 Notson, Inc. produces several models of clocks. An outside supplier has offered to produce the commercial clocks for Notson for $420 each. Notson needs 1,200 clocks annually. Notson has provided the following unit costs for its commercial clocks: Direct materials Direct labor Variable overhead Fixed overhead (40% avoidable) $100 140 80 150 Prepare an incremental analysis which shows the effect of the make-or-buy decision. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45.) Incremental Analysis Incremental Effect $ Savings of direct labor Savings of direct material Savings of variable overhead Incremental net cost to make Savings of fixed overhead Incremental net cost to buy Total cost savings Cost to make Cost to buy Cost savings

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