mou 1. Given the same cost structure, should TechSystems make or buy the switch? Show your analysis. 2. Now, assume that Tech Systems can avoid $102,000 of fixed costs a year by outsourcing production. In addition, because sales are increasing, TechSystems needs 70,000 switches a year rather than 65,000 switches. What should the company do now? 3. Given the last scenario, what is the most TechSystems would be willing to pay to outsource the switches? Data Table ould und am cost Direct materials $ 585,000 ems Direct labor 162,500 Outs Variable MOH 195,000 390,000 e Fixed MOH + $ Total manufacturing cost for 65,000 units 1,332,500 TechSystems manufactures an optical switch that it uses in its final product. TechSystems incurred the following manufacturing costs when it produced 65,000 units last year: Click the loon to view the manufacturing costs.) TechSystems does not yet know how many switches it will need this year, however, another company has offered to sell TechSystems the switch for $17.50 per unit. If Tech Systems buys the switch from the outside supplier, the manufacturing facilities that will be idle cannot be used for any other purpose, yet none of the fixed costs are avoidable Read the requirements Requirement 1. Given the same cost structure, should TechSystems make or buy the switch? Show your analysis. Complete an incremental analysis to show whether Toch Systems should make or buy the switch (Enter a "O" for any zero amounts. Round amounts to the nearest cant. Uw a minus sign or parentheses when the cost to buy exceeds to cost to make.) TechSystems Incremental Analysis for Outsourcing Decision Make Buy Unit Unit Difference Variable cost per unit: TechSystems Incremental Analysis for Outsourcing Decision Make Buy Unit Unit Variable cost per unit: Difference Total variable cost per unit