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Instead of making the switches at an average cost of $2.95($177,00060,000), the company has an opportunity to buy the switches at $2.70 per unit. If
Instead of making the switches at an average cost of $2.95($177,00060,000), the company has an opportunity to buy the switches at \$2.70 per unit. If the company purchases the switches, all the variable costs and one-fourth of the fixed costs will be eliminated. (a) Prepare an incremental analysis showing whether the company should make or buy the switches. (b) Would your answer be different if th released productive capacity will generate additional income of $34,000 ? Sell or process further
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