Innova uses 1,000 units of the component IMC2 every month to manufacture one of its products. The unit costs incurred to manufacture the component are as follows.

Direct materials		$55.00
Direct labor		35.00
Overhead		126.50
Total		$216.50

Overhead costs include variable material handling costs of $6.50, which are applied to products on the basis of direct material costs. The remainder of the overhead costs are applied on the basis of direct labor dollars and consist of 60.00% variable costs and 40.00% fixed costs. A vendor has offered to supply the IMC2 component at a price of $200.00 per unit. (a) Prepare the incremental analysis for the decision to make or buy IMC2. Assume that no fixed costs will be eliminated if production is outsourced. (Round answers to 2 decimal places, e.g. 12.25. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

		Make IMC2 (per unit)		Buy IMC2 (per unit)		Net Income Increase (Decrease)
Direct material		$enter a dollar amount		$enter a dollar amount			$enter a dollar amount
Direct labor		enter a dollar amount		enter a dollar amount			enter a dollar amount
Material handling		enter a dollar amount		enter a dollar amount			enter a dollar amount
Variable overhead		enter a dollar amount		enter a dollar amount			enter a dollar amount
Fixed overhead		enter a dollar amount		enter a dollar amount			enter a dollar amount
Purchase price		enter a dollar amount		enter a dollar amount			enter a dollar amount
Total unit cost		$enter a total amount		$enter a total amount			$enter a total amount

Should Innova purchase the component from the outside vendor if Innovas unused facilities remain idle? select an option NoYes