Inteli Systems manufactures an optical switch that it uses in its final product. Inteli Systems incurred the following manufacturing costs when it produced 70,000 units last year: 5(Click the icon to view the manufacturing costs.) Inteli Systems does not yet know how many switches it will need this year; however, another company has offered to sell Inteli Systems the switch for $14 per unit. If Inteli Systems buys the switch from the outside supplier, the manufacturing facilities that become idle cannot be used for any other purpose, yet none of the fixed costs are avoidable. Requirements .... Requirement 1. Given the same cost structure, should Inteli Systems make or buy the switch? Show your analysis. Complete an incremental analysis to show whether Inteli Systems should make or buy the switch. (Round your answers to the nearest cent. All boxes in the Cost to Make Minus Cost to Buy column should have a value entered.) Inteli Systems Outsourcing Decision Make Unit Buy Unit Cost to Make Minus Cost to Buy Requirements Manufacturing costs Variable cost per unit: Direct materials Direct materials 595,000 Direct labour Direct labour. 119,000 Variable overhead 1. Given the same cost structure, should Inteli Systems make or buy the switch? Show your analysis. 2. Now, assume that Inteli Systems can avoid $77,000 of fixed costs year by outsourcing production. In addition, because sales are increasing, Inteli Systems needs 78,000 switches a year rather than 70,000. What should Inteli Systems do now? 3. Given the last scenario, what is the most Inteli Systems would be willing to pay to outsource the switches? Variable overhead 154,000 Purchase price from outsider Fixed overhead 450,000 $ 1,318,000 Total variable cost per unit Total manufacturing cost for 70,000 units Print Done Print Done