C. Mikel Company is considering outsourcing production of its product packaging. The company has received a bid from a vendor to produce the required 1,000 units of packaging per year for $22 each. Mikel Co. has determined that it could eliminate all variable costs if the packaging was produced externally, but none of the fixed overhead is avoidable. Mikel Co. has no specific plans for the space currently being used by the packaging production $10 $4 Direct Materials Direct Labor Variable manufacturing overhead $6 Fixed manufacturing overheadS3 Total cost per unit $ 23 1. Compute the relevant total cost of making the packaging internally 2. Compute the total cost of outsourcing the packaging. 3. Should Mikel continue to make its own packaging or outsource it to the vendor (make or buy)? 4. Suppose Mikel Co. decides it could use the space currently used for packaging production to make a new product line that would generate $5,000 in annual profit. What would be the new cost structure be for outsourcing (buying) including the offsetting profit? In this situation, should or buy)? 5. ikel continue to make its own packaging or outsource it to the vendor (make