please answer b

Riggs Company purchases sails and produces sailboats. It currently produces 1,280 sailboats per year, operating at normal capacity, which is about 80% of full capacity. Riggs purchases sails at $258 each, but the company is considering using the excess capacity to manufacture the sails instead. The manufacturing cost per sall would be $91 for direct materials, $87 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 Riggs has come to you for advice. "It would cost me $268 to make the salls,' she says, "but only $258 to buy them. Should I continue buying them, or have I missed something?" (b) If Riggs suddenly finds an opportunity to rent out the unused capacity of its factory for $77,600 per year, would your answer to part(a) change? This is because the net income will by $ e Textbook and Media Save for Later Attempts: 0 of 7 used Submit Answer Question Part Score --/5