Exercise 12-6 Marigold, 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 19,700 Tri-Robos is as follows. Direct materials ($52 per robot) Direct labor ($40 per robot) Variable overhead ($7 per robot) Allocated fixed overhead ($30 per robot) Total Cost $1,024,400 788,000 137,900 600,000 $2,550,300 Marigold is approached by Tienh Inc., which offers to make Tri-Robo for $119 per unit or $2,344,300. Following are independent assumptions. Prepare an incremental analysis. Assume that $405,000 of the fixed overhead cost can be avoided. (If amount decreases net income then enter the amount 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 Direct labor Variable overhead Fixed overhead Purchase price Total annual costs Using incremental analysis, determine whether Marigold should accept this offer. The offer LINK TO TEXT VIDEO: APPLIED SKILLS Prepare an incremental analysis. Assume that none of the fixed overhead can be avoided. However, if the robots are purchased from Tienh Inc., Marigold can use the released productive resources to generate additional income of $375,000. (If amount decreases net income then enter the amount 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 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 Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT VIDEO: APPLIED SKILLS Question Attempts: 0 of 3 used SAVE FOR LATER SAVE FOR LATER SUBMIT ANSWER SUBMIT