Polo Enterprises manufactures one of the components used to assembleits main company product Specialty Product ino, has offered to make the component at a cost of $12.30 per unit. Pole Enterprises current cost is $14.75 per unit of the component based on the 120,000 components that Polo Enterprises currently produces Read the This current cost per una based on the following calculations Co the .co o view the formation) None of Polonteri fred costs will be limited component is outsourced. However, the red capacity could be used to build a new product. This new product would be expected to generate $25,000 of contrbution man Difference Requirement 1. Pelo Eroprinosauro De manutacturing of the component, we operating room recreate or decreme by how much der to any sono belances. Le minus sign or partes in the Dorence column when the cost to make exceeds the cost to buy Incremental Analysis Make Outsource Outsourcing Decision Component Component Variable costs Food costs Total cost of 120.000 components Les Petrom other product Nel cost - X ata Table source benera 5.50 renthe 6.25 0.75 Direct material per unit.... $ - Direct labor per unit.... Variable manufacturing overhead per unit. Fixed manufacturing overhead per unit ..... $ Total manufacturing costs per unit .. 2.25 14.75 ..... Print Done 1. If Polo Enterprises outsources the manufacturing of the component, will operating income increase or decrease? By how much? 2. What is the maximum price per unit Polo Enterprises would be willing to pay if it outsources the component? Print Done