Pharoah Company purchases sails and produces sailboats. It currently produces 1,220 sailboats per year, operating at normal capacit which is about 80% of full capacity. Pharoah purchases sails at $261 each, but the company is considering using the excess capacity to manufacture the sails instead. The manufacturing cost per sail would be $96 for direct materials, $80 for direct labor, and $90 for overhead. The $90 overhead is based on $78,080 of annual fixed overhead that is allocated using normal capacity. The president of Pharoah has come to you for advice. "It would cost me $266 to make the sails," she says, "but only $261 to buy them. Should I continue buying them, or have I missed something?" Your answer is partially correct. If Pharoah suddenly finds an opportunity to rent out the unused capacity of its factory for $78,000 per year, would your answer to part (a) change? This is because the net income will by $