Cans Inc. is considering purchasing component YY instead if producing it in-house. Component YY can be purchased for $207.

The following cost information pertains to the production of component YY. Cans Inc. uses 75,000 compenents per year.

Direct Materials			$100.80
Direct Labor (10 minutes per part)
($18 per hour)			$3
Variable OH			$4.60
Fixed OH			$234,000
Depreciation			$32,420

Prepare an incremental analysis to determine if component YY should continue to be produced in-house or purchased from an outside vendor.