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Make versus Buy Decision GSO produces mini-grills. This year's expected production is 10,000 units. Currently, GSO also makes side burners for the grills. Each grill includes two side burners. The following are costs for making 20,000 burners: Side Burner costs Cost per unit Costs for 20,000 units Direct materials $4.00 $80,000 Direct manufacturing labor 2.00 40,000 Variable manufacturing overhead 1.00 20,000 Inspections, setups, materials handling 4,000 Machine rent 6,000 Allocated fixed overhead (plant admin., insurance, taxes) 40,000 Total costs $190,000 GSO has received an offer from an outside vendor to supply any number of burners GSO requires at $8.20 per burner. Inspection, setups, and materials handling costs vary with the number of batches in which the burners are produced. GSO produces burners in batch sizes of 500 units. GSO rents the machine and can cancel the rental agreement at any time. Required: a) Should GSO accept the outside vendor's offer at the anticipated volume of 20,000 burners? Assume the unused facility space will be idle if the offer is accepted. Show your calculations. b) Now assume that the space left unused if the burners are outsourced will be used to add a rotisserie attachment to the grills (one rotisserie per grill). By including a rotisserie attachment the mini-grill selling price will increase by $24 and variable costs will increase by $18 per unit. An additional tooling cost of $40,000 per year would also be incurred. Should GSO make or buy the burners, assuming that 10,000 grills are produced (and sold)? c) Now assume production will only be 8,000 mini grills. This frees up space to add the rotisserie attachment whether GSO makes or buys the burners. The number of batches to make the burners would be reduced (batch size remains at 500). Should GSO purchase the burners from the outside vendor