Sheffield has recently started to manufacture RecRobo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit this information to a mobile phone. The cost structure to manufacture 19,900 RecRobos is as follows: Cost Direct materials ($41 per robot) $815,900 Direct labour ($30 per robot) 597,000 Variable overhead ($5 per robot) 99,500 Allocated fixed overhead ($24 per robot) 477,600 Total $1,990,000 Sheffield is approached by Cato Inc., which offers to make RecRobo for $76 per unit or $1,512,400. Using incremental analysis, determine whether Sheffield should accept this offer under each of the following independent assumptions: (1) Assume that $298,500 of the fixed overhead cost is avoidable. (If an amount reduces the net income then enter with a negative sign preceding the number e.g. -15,000 or parenthesis, e.g. (15,000). While alternate approaches are possible, irrelevant fixed costs should be included in both options when solving this problem.) Net Income Increase Make Buy (Decrease) Direct materials $ $ $ Direct labour Variable overhead Fixed overhead Purchase price Total annual costShould the offer be accepted? (2) Assume that none of the fixed overhead is avoidable. However, if the robots are purchased from Cato Inc., Sheffield can use the released productive resources to generate additional income of $198,500. (If an amount reduces the net income then enter with a negative sign preceding the number e.g. -15,000 or parenthesis, e.g. (15,000). While alternate approaches are possible, irrelevant fixed costs should be included in both options when solving this problem.) Net Income Increase Make Buy (Decrease) Direct materials v $ $ Direct labour Variable overhead Fixed overhead Purchase price Opportunity cost Total annual cost Should the offer be accepted