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Crane, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit
Crane, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit this information to a smartphone. The cost structure to manufacture 20.200 Tri-Robos is as follows. Cost Direct materials ($ 48 per robot) $969,600 Direct labor ($ 42 per robot) 848,400 Variable overhead ($ 7 per robot) 141,400 Allocated fixed overhead ($ 30 per robot) 606,000 Total $ 2,565,400 Crane is approached by Tienh Inc., which offers to make Tri-Robo for $ 116 per unit or $ 2,343,200. Following are independent assumptions. (a1) Assume that $ 405,000 of the fixed overhead cost can be avoided. (Enter negative amounts using either a negative sign preceding the number eg.-45 or parentheses eg. (45).) Net Income Increase (Decrease) Make Buy Direct materials $ Direct labor Variable overhead Fixed overhead Purchase price Total annual cost $ Using incremental analysis, determine whether Crane should accept this offer. The offer e Textbook and Media Save for Later Attempts: 0 of 3 used Submit Answer (22) The parts of this question must be completed in order. This part will be available when you complete the part above
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