Sandhill, Inc. produces several models of clocks. An outside supplier has offered to produce the commercial clocks for Sandhill for $500 each. Sandhill needs 1,140 clocks annually. Sandhill has provided the following unit costs for its commercial clocks:

Direct materials		$100
Direct labor		150
Variable overhead		100
Fixed overhead (40% avoidable)		250

Prepare an incremental analysis which shows the effect of the make-or-buy decision. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Incremental Analysis				Incremental Effect
select an item Cost to buyCost to makeTotal cost savingsVariable overheadDirect materialCost savingsIncremental net cost to buyIncremental net cost to makeDirect laborFixed overhead				$enter a dollar amount
select an opening section name Variable overheadCost to makeIncremental net cost to buyCost to buyFixed overheadTotal cost savingsCost savingsDirect laborIncremental net cost to makeDirect material
select an item Incremental net cost to makeDirect laborCost savingsFixed overheadCost to makeIncremental net cost to buyDirect materialTotal cost savingsCost to buyVariable overhead		$enter a dollar amount
select an item Variable overheadFixed overheadIncremental net cost to buyDirect laborCost savingsTotal cost savingsDirect materialIncremental net cost to makeCost to buyCost to make		enter a dollar amount
select an item Direct laborCost savingsIncremental net cost to buyVariable overheadIncremental net cost to makeDirect materialTotal cost savingsFixed overheadCost to makeCost to buy		enter a dollar amount
select an item Direct materialIncremental net cost to makeCost to makeDirect laborTotal cost savingsCost savingsIncremental net cost to buyCost to buyVariable overheadFixed overhead		enter a dollar amount
select a closing section name Total cost savingsDirect laborCost to makeCost to buyCost savingsIncremental net cost to buyVariable overheadIncremental net cost to makeDirect materialFixed overhead				enter a total amount for this section
select a closing name Fixed overheadIncremental net cost to makeIncremental net cost to buyCost savingsTotal cost savingsDirect materialDirect laborVariable overheadCost to makeCost to buy				$enter a total amount