Outdoor Life manufactures snowboards. Its cost of making 2,100 bindings is as follows: (Click the icon to view the costs.) Suppose Topnotch will sell bindings to Outdoor Life for $14 each. Outdoor Life would pay $3 per unit to transport the bindings to its manufacturing plant, where it would add its own logo at a cost of $0.60 per binding. Read the requirements Requirement 1. Outdoor Life's accountants predict that purchasing the bindings from Topnotch will enable the company to avoid $2,600 of fixed overhead. Prepare an analysis to show whether Outdoor Life should make or buy the bindings. (Only enter the net relevant costs. For the Difference column, use a minus sign or parentheses only when the cost of outsourcing exceeds the cost of making the bindings in-house.) Make Outsource Difference (Make-Outsource) Binding costs Bindings Bindings Variable costs Direct materials Direct labor Variable overhead Fixed costs Purchase price from Topnotch Transportation Logo Total differential cost of 2,100 bindings Should Outdoor Life make or buy the bindings? Decision: Requirement 2. The facilities freed by purchasing bindings from Topnotch can be used to manufacture another product that will contribute $3,000 to profit. Total fixed costs will be the same as if Outdoor Life had produced the bindings. Show which alternative makes the best use of Outdoor Life's facilities. (Only enter the net relevant costs. Enter all costs as positive values. Use a minus sign or parentheses for decreases to net costs.) Outsource Bindings Facilities Make New Make Binding costs Bindings Idle Product Data table Variable Costs: Direct materials Direct materials 17,570 Direct labor Variable overhead Direct labor 2.900 Variable overhead Fixed costs 2,070 6,700 Fixed overhead $ 29,240 Total manufacturing costs for 2,100 bindings Purchase price from Topnotch Transportation Logo Expected profit from new product Expected net cost of obtaining 2,100 bindings Print Done Which alternative makes the best use of Outdoor Life's facilities? Decision