Question 2 of 5 The management of Blossom Manufacturing Company is trying to decide whether to continue mar an outside supplier. The part, called CISCO, is a component of the company's finished product. The following information was collected from the accounting records and production data for they 1.7,900 units of CISCO were produced in the Machining Department. 2. Variable manufacturing costs applicable to the production of each CISCO unit were: direct materials $4.50, direct labor $4.00, indirect labor $0.40, utilities $0.35. 3. Fixed manufacturing costs applicable to the production of CISCO were: Cost Item Direct Allocated Depreciation $1,900 $860 Property taxes 460 260 Insurance 860 560 $3,220 $1,680 All variable manufacturing and direct fixed costs will be eliminated if CISCO is purchased. Allocated CISCO is purchased. So if CISCO is purchased, the fixed manufacturing costs allocated to CISCO wil production departments. 4. The lowest quotation for 7,900 CISCO units from a supplier is $73,349. 5. If CISCO units are purchased, freight and inspection costs would be $0.34 per unit, and receiving would be incurred by the Machining Department. (a) Prepare an incremental analysis for CISCO. (Enter negative amounts using either a negative sign prec parentheses e.g. (45).) Question 2 of 5 All variable manufacturing and direct fixed costs will be eliminated if CISCO is purchased. Allocated costs w CISCO is purchased. So if CISCO is purchased, the fixed manufacturing costs allocated to CISCO will have to production departments. 4. The lowest quotation for 7,900 CISCO units from a supplier is $73.349. 5. If CISCO units are purchased, freight and inspection costs would be $0.34 per unit, and receiving costs to would be incurred by the Machining Department. (a) Prepare an incremental analysis for CISCO. (Enter negative amounts using either a negative sign preceding th parentheses e.g. (45).) Net In (DE Make CISCO Buy CISCO Direct material $36,182 $ 0 $ Direct labor $35,629 0 Indirect labor $3,555 0 Utilities $3,239 Depreciation $2.760 $860 Property taxes $850 $320 Insurance $1,480 $610 Purchase price $O $78,853 Make CISCO Buy CISCO Direct material TA $36,182 $ O Direct labor $35,629 o Indirect labor $3,555 0 Utilities $3,239 0 Depreciation $2,760 $860 $850 $320 Property taxes Insurance $1,480 $610 Purchase price $0 $78,853 Freight and inspection $0 $3,002 $0 $1,260 Receiving costs $ $83,695 $ Total annual cost HA $84,905