Ejercicio #1 Snipe Company has been purchasing a component, Part Q for $19.20 per unit. Snipe is currently operating at 70% of capacity and no significant increase in production is anticipated in the near future. The cost of manufacturing a unit of Part Q is estimated as follows: Direct materials $11.50 Direct labor 4.50 Variable factory overhead 1.12 Fixed factory overhead 3.15 Total $20.27 differential analysis report, dated March 12 of the current year, on the decision to make or buy Part Q. Prepare Ejercicio #2 Due to Medicare reimbursement cuts, Loving Home Care is considering shutting down its Certified Nursing Assistant (CNA) Division. Fixed costs will have to be transferred to the Nursing Division if the CNA divisioni discontinued. Based on the following income statement make a recommendation to the president regarding this decision. Loving Home Care Condensed Income Statement For the Year Ended December 31 Revenues Nursing CNA Total $3,500,000 $1,000,000 $4,500,000 2,000,000 700,000 2,700,000 Variable Costs Fixed Costs 400,000 400.000 800,000 $1,100,000 $100,000) $1,000,000 Net Income from Operations