Lunar, Inc. produces several types of hoses. An outside supplier has offered to produce the commercial hose for Lunar for $640 each. Lunar needs 1,000 fountains annually. Lunar has provided the following unit costs for its commercial hoses:

Direct Materials $150

Direct labor 140

Variable overhead 100

Fixed overhead (30% avoidable) 200 >

Instructions Prepare an incremental analysis which shows the effect of the make-or-buy decision.