Rhoto's president has decided to introduce a new product for this coming winter. If the product is a success, further expansion in future years will be initiated. The product selected $($called Lipice$)$ is a lip balm that will be sold in a lipstick$-$type tube. The product will be sold to wholesalers in boxes of $24$ tubes for $$8$ per box. Because of excess capacity, no additional fixed manufacturing overhead costs will be incurred to produce the product. However, a $$90,000$ charge for fixed manufacturing overhead will be absorbed by the product under the company's absorption costing system. Using the estimated sales and production of $100,000$ boxes of Lipice, the Accounting Department has developed the following cost per box.Direct material$$3\mathrm{.}6$Direcr labor$2\mathrm{.}0$Manufacturing overhead$1\mathrm{.}4$vanoble$8\mathrm{.}1$ GO bODTotal cost$$7\mathrm{.}0$The costs above include costs for producing both the lip balm and the tube that contains it$.$ As an alternative to making the tubes, Rhoto has approached a supplier to discuss the possibility of purchasing he tubes for Lipice. The purchase price of the empty tubes from the supplier would be $$1\mathrm{.}35$ per box of $24$ tubes. If Rhoto accepts the purchase proposal, direct labor and variable manufacturing overhead costs per box of Lipice would be reduced by $10\%$ and direct materials costs would be reduced by $25\%\mathrm{.}1.$ Calculate the break $-$ even quantities and the degree of operating leverage at $100,000$ boxes if Rhoto make the tube$\mathrm{.}2.$ Should Rhoto make or buy the tube? Show calculations to support your answer$\mathrm{.}3.$ What would be the maximum purchase price acceptable to Rhoto Incs.? Explain$\mathrm{.}4.$ What qualitative factors should Rhoto Incs. consider in determining whether they should make or buy the tubes?