Cullumber, 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 20,300 Tri-Robos is as follows. Cost Direct materials ($49 per robot) Direct labor ($41 per robot) Variable overhead ($5 per robot) Allocated fixed overhead ($30 per robot) Total $994,700 832,300 101,500 609,000 $2,537,500 Cullumber is approached by Tienh Inc., which offers to make Tri-Robo for $114 per unit or $2,314,200. Following are independent assumptions. (a 1) Your Answer Correct Answer (Used) Your answer is correct. Assume that $405,000 of the fixed overhead cost can be avoided. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses eg. (45).) Net Income Increase (Decrease) Make Buy $ 994700 i $ O $ 994700 Direct materials Direct 832,300 i 0 832,300 labor 101,500 i 0 101,500 609,000 i 204,000 i 405,000 Variable overhead Fixed overhead Purchase price Total annual cost 0 2,314,200 -2,314,200 $ 2,537,500 2,518,200 19,300 (a2) Assume that none of the fixed overhead can be avoided. However, if the robots are purchased from Tienh Inc., Cullumber can use the released productive resources to generate additional income of $375,000. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net Income Increase (Decrease) Make Buy Direct materials $ $ $ Direct labor Variable overhead Fixed overhead Opportunity cost Purchase price Totals $ $ $ Based on the above assumptions, indicate whether the offer should be accepted or rejected? The offer e Textbook and Media Save for Later Attempts: 0 of 3 used Submit