Question 8 Sheridan Company must decide whether to make or buy some of its components. The costs of producing 61,300 switches for its generators are as follows. Direct materials $30,100 Variable overhead $44,600 Direct labor $26,670 Fixed overhead $76,400 Instead of making the switches at an average cost of $2.90 ($177,770 - 61,300), the company has an opportunity to buy the switches at $2.72 per unit. If the company purchases the switches, all the variable costs and one-fourth of the fixed costs will be eliminated. Your answer is partially correct. Try again. Prepare an incremental analysis showing whether the company should make or buy the switches. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Make Buy Net Income Increase (Decrease) Direct materials 30,100 X Direct labor 26,670 X Variable manufacturing costs 44,600 Fixed manufacturing costs 76,400 Purchase price Total cost 177,770 bis Sheridan Company will incur of additional costs if it buys the switches. LINK TO TEXT Your answer is partially correct. Try again. Would your answer be different if the released productive capacity will generate additional income of $50,176? (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Make Buy Net Income Increase (Decrease) x Total Cast 177,770 Opportunity cost 50,176 50,176 X Total cost 227,946 $ Yes different increased the answer is The analysis shows that net income will be by