Direct materials Direct labor Variable overhead Fixed overhead 17,560 3,400 2,120 7,000 $ 30,080 Total manufacturing costs for 1,900 bindings X-Perience manufactures snowboards. Its cost of making 1,900 bindings is as follows: B. (Click the icon to view the costs.) Suppose Lewis will sell bindings to X-Perience for $16 each. X-Perience would pay $1 per unit to transport the bindings to its manufacturing plant, where it would add its own logo at a cost of $0.40 per binding. Read the requirements. Requirement 1. X-Perience's accountants predict that purchasing the bindings from Lewis will enable the company to avoid $2,300 of fixed overhead. Prepare an analysis to show whether X-Perience should make or buy the bindings. (Only enter the net relevant costs. For the Difference column, use a minus sign or parentheses only when the cost of outsourcing exceeds the cost of making the bindings in-house.) Make Bindings Outsource Bindings Difference (Make-Outsource) Binding costs Variable costs: Direct materials Direct labor Variable overhead Fixed costs Purchase price from Lewis Transportation Logo Total differential cost of 1,900 bindings Should X-Perience make or buy the bindings? Decision: Requirement 2. The facilities freed by purchasing bindings from Lewis can be used to manufacture another product that will contribute $2,600 to profit. Total fixed costs will be the same as if X-Perience had produced the bindings. Show which alternative makes the best use of X-Perience's facilities. (Only enter the net relevant costs. Enter all costs as positive values. Use a minus sign or parentheses for decreases to net costs.) Outsource Bindings Make Bindings Facilities Idle Make New Product Binding costs Variable Costs: Direct materials Direct labor Variable overhead Fixed costs Purchase price from Lewis Transportation Logo Expected profit from new product Expected net cost of obtaining 1,900 bindings Which alternative makes the best use of X-Perience's facilities? Decision: Enter any number in the edit fields and then continue to the next