P25-25A (similar to) Question Help Mountain Fun manufactures snowboards. Its cost of making 1,800 bindings is as follows: (Click the icon to view the costs.) Suppose Witherspoon will sell bindings to Mountain Fun for $13 each. Mountain Fun would pay $3 per unit to transport the bindings to its manufacturing plant, where it would add its own logo at a cost of $0.40 per binding. Read the requirements Requirement 1. Mountain Fun's accountants predict that purchasing the bindings from Witherspoon will enable the company to avoid S2,500 of fixed overhead. Prepare an analysis to show whether Mountain Fun 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 Binding costs Bindings Bindings (Make-Outsource) Variable costs: Direct materials Direct labor Variable overhead Fixed costs Purchase price from Witherspoon Transportation Logo Total differential cost of 1,800 bindings X Requirements Data Table 1. Mountain Fun's accountants predict that purchasing the bindings from Witherspoon will enable the company to avoid $2,500 of fixed overhead. Prepare an analysis to show whether Mountain Fun should make or buy the bindings. The facilities freed by purchasing bindings from Witherspoon can be used to manufacture another product that will contribute $2,700 to profit. Total fixed costs will be the same as if Mountain Fun had produced the bindings. Show which alternative makes the best use of Mountain Fun's facilities: (a) make bindings, (b) buy bindings and leave facilities idle, or (c) buy bindings and make another product S Direct materials 17,600 Direct labor 3,100 2. Variable overhead 2,100 6,500 Fixed overhead 29,300 Total manufacturing costs for 1,800 bindings