Please see sample question:

Example 2:

Parks Corporation currently manufactures 3,000 staplers annually for its main product. The costs per stapler are as follows:

Direct materials$3

Direct labor7

Variable overhead4

Fixed overhead7

Total$21

Gallup Company has contacted Parks with an offer to sell it 3,000 staplers for $18 each. $5 of the fixed overhead per unit is unavoidable.

Instructions

Make a incremental analysis for the make-or-buy decision.