Lijia Inc. manufactures appliances. One of their divisions manufactures a timer which are used in several of their appliances. They produce 32,000 timer units annually. The cost per unit for the timer is as follows: Description Cost Direct materials 9.00 Direct labour 3.00 Variable overhead 2.25 Fixed overhead 5.25 Total cost 19.50 Of the total fixed overhead assigned to the timers, $64,000 is directly attributable to the production of the timer. The remaining fixed overhead costs are common fixed overhead. An outside supplier has offered to sell the timers to Lijia Inc. for $16.50 per unit. Use the above information to answer all of the following questions. Question 1 (1 point) If there was no other alternative use for the facilities that is currently used to produce the timers, should Lijia Inc. make or buy the timers? a) Make Ob) Buy c) Indifferent Question 2 (3 points) What is the most that Lijia Inc. would be willing to pay an outside supplier for one unit of the timer? Question 3 (1 point) If Lijia Inc. buys the timers, would their operating income increase, decrease, or stay the same? a) Increase b) Stay the same c) Decrease Question 4 (2 points) If Lijia Inc. buys the timer, by how much would their operating income change? Input your answer as a positive number. AJ Question 5 (1 point) If Lijia Inc. could rent out the space that is currently used to produce the timers for $22,000 per year, should the company make or buy the timers? a) Buy b) Make c) Indifferent Question 6 (2 points) If Lijia Inc. buys the part and then rents out the space that is currently used to produce the timers for $22,000 per year, by how much would their operating income change? Input your answer as a positive number. A/