SANCHETI Skate, Inc. currently manufactures the wheels that it uses for its in-line skates. The annual costs to manufacture the 150,000 wheels needed each year are as follows: ROZANSKI Rubber Company has offered to provide SANCHETI with all of its annual wheel needs for $3.5 per wheel. Required: Assuming that if SANCHETI accepts this offer, 75% of the fixed overhead above could be totally eliminated (avoided). Also, SANCHETI would be able to rent out the freed up space and could generate $72,000 of income annually. Based on this information, should SANCHETI make the wheels or buy them from ROZANSKI? Show calculations. 2. Stephans Corporation currently manufactures a subassembly for its main product. The costs per unit are as follows: Bill Company has contacted Stephans with an offer to sell them 5,000 of the subassemblies for $22.00 each. Stephans will eliminate (AVOID) $25,000 of fixed overhead if it accepts the proposal. Required: Should Stephans make or buy the product? Show calculations 3. SECK Manufacturing makes a single product. Budget information regarding the current period is given below (in totals): SCOTT Company approaches SECK with a special order for 20,000 units at a price of $18 per unit. Variable costs will be the same as the current production and accepting the special order will not have any impact on the rest of the company's orders. However, SECK is operating at capacity and will incur an additional $150,000 in fixed manufacturing overhead if the order is accepted. Should SECK accept or reject the special order? WATSON Company produces two products for a common input. Data relating to the products are given below: Required: Should each of the products should be sold at the split-off point or processed further? Show calculations