Make or Buy Decision: ZeeDrive Ltd. is a computer manufacturer. One of the items they make is monitors. ZeeDr'ive has the opportunity to purchase 1?,000 monitors from an outside supplier for $209 per unit. One of the company's costaccounting interns prepared the following schedule of ZeeDrive's cost to produce 1?,000 monitors: Total cost of producing 17,000 monitors Unit cost Direct materials 52; 2,040,000 $ 120 Direct labor 1,173,000 69 Variable factory overhead 595,000 35 Fixed manufacturing overhead 425,000 25 Fixed nonmanufacturing overhead 663,000 39 $ 4,896,000 $288 You are asked to look over the intem's estimate before the information is shared with members of management who will decide to continue to make the monitors or buy them. The company's controller believes that the estimate may be incorrect because it includes costs that are not relevant. If ZeeDr'ive buys the monitors, the direct labor force currently employed in producing the monitors will be terminated and there would be no termination costs incurred. There are no materials on hand and no commitments to suppliers to purchase materials, so all materials would need to be purchased to make the monitors. Variable overheads are avoidable if monitors are bought. Fixed manufacturing overhead costs would be reduced by $49,000, but nonmanufacturing costs would remain the same if monitors are bought. Fill in the differential analysis. Make or Buy Decisions Differential Analysis Report Purchase price of 17,000 monitors 'r 3,553,000 J Differential cost to make: Direct mate rials $I:I Overhead I I I I Differential income (loss) from making monitors $I:I