Incremental Analysis- Make vs. Buy Decision Benz Industries manufactures cell phones. It manufactures 100,000 cell phones every year. It has traditionally manufactured the protective cases for their phones, but now has the opportunity to buy them from a supplier for $5 each. Benz must now decide whether to continue to make those protective cases or to buy them. Benz's variable costs are $2 per case. It has fixed overhead costs of $200,000 a year that would be eliminated if it were to purchase these cases rather than manufacture them. Should they continue to make these cases, or should they buy them? Make Buy Difference Variable Costs Fixed Costs Purchase Price Suppose Benz determincs that if it buys the cases instead of making them, that it can usc that factory space to manufacture accessories for its phones which will contribute $150,000 to operating income? Does that change your answer? Make Buy Difference Variable Costs Fixed Costs Purchase Price "Extra Income