Exercise 7-5 (Video) Pottery Ranch Inc. has been manufacturing its own finials for its curtain rods. The company is currently operating at 100% of capacity, and variable manufacturing overhead is charged to production at the rate of 56% of direct labor cost. The direct materials and direct labor cost per unit to make a pair of finials are stand $5, respectively. Normal production is 25,800 curtain rods per year. A supplier offers to make a pair of finials at a price of $13.30 per unit. If Pottery Ranch accepts the supplier's offer, all variable manufacturing costs will be eliminated, but the $46,100 of fixed manufacturing overhead currently being charged to the finials will have to be absorbed by other products. (a) Prepare the incremental analysis for the decision to make ar buy the finials. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Make Buy Net Income Increase (Decrease) Direct materials Direct labar Variable averhead costs Fixed manufacturing costs Purchase price Tatal annual cost (b) Should Pottery Ranch buy the finals? Pottery Ranch should the finals. (c) Would your answer he different in (b) if the productive capacity released by not making the finials could be used to produce income af $44,5002 income would Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT Question Attempts: Unlimited