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Jobs, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit

Jobs, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit this information to a smartphone. The cost structure to manufacture 19,300 Tri-Robos is as follows.

Cost
Direct materials ($51 per robot) $984,300
Direct labor ($38 per robot) 733,400
Variable overhead ($6 per robot) 115,800
Allocated fixed overhead ($31 per robot) 600,000
Total $2,433,500

Jobs is approached by Tienh Inc., which offers to make Tri-Robo for $115 per unit or $2,219,500. Following are independent assumptions.

image text in transcribed

Assume that $405,000 of the fixed overhead cost can be avoided. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net Income Increase (Decrease) Make Buy Direct materials Direct labor Variable overhead Fixed overhead Purchase price Total annual cost

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