Part 3 1. Incremental Analysis points) fered to produce the commercial Nofson, Inc. produces several models of cocks An outside supplier has offered to pro For Notson for $420 each. Notsoneets 1200 clocks annually. Notson has provided the following unit costs for its commercial clocks Direct materials S100 Direct labor Variable overhead 80 Fixed overhead (40% unavoidable) 150 repare an incremental analysis which shows the effect of the make-or-buy decision in good form ( point). Should the company buy or make the product? Explain (1 point). 140 2. Cost-Plus Pricing (4 points) Joey's Recording Studio rents studio time to musicians in 2 hour blocks. Each session includes the use of the studio facilities, a digital recording of the performance and a professional music producer/mixer. Anticipated annual volume is 1,000 sessions. The company has invested $4,000,000 in the studio and expects a return on investment (ROI) of 17.5%. Budgeted costs for the coming year are as follows. Per Session Total Direct materials (tapes, CDs, etc) $60 Direct labor $400 Variable overhead $50 Fixed overhead $950,000 Variable selling and administrative expenses $40 Fixed selling and administrative expenses $800,000 Instructions (a) Determine the total cost per session. (1 point) 800,000 60+400+50+/950.000 1000