Resource Spending Approach: Assume the decisions to make pool shades and trellises are considered to be a short-term decision and that Chandler would make these products one at a time when time is available, so as not to not delay any of the custom orders. Because there is excess capacity on current production equipment, the company wants to use a tactical decision (resource spending) approach to evaluate the decision to make the products. Exhibit 3 provides information about the cost to purchase additional resources. a. Compute the net change in cash flow of making and selling the full demand of pool shades. b. Compute the net change in cash flow of making and selling the full demand of trellises. c. Compute the net change in cash flow of making the full demand for both the pool shades and the trellises. d. Given the assumptions aforementioned (such as short-term and excess capacity), would Chandler's management choose to make either or both of the products? Explain your answer.

Exhibit 3. Purchase Price of Additional Capacity Resource Design/Drafting Capacity of next step 2,000 Cost Driver Design hours Cost of Next Step $50,000 Engineering 2,000 Engineering hours $110,000 Fabrication Powder coating 3,000 20,000 Parts Square feet $3,150 $1 00.000 Scheduling/setup 5,000 Job setups $4,000 General factory 2,000 Machine hours $36,000