Sheffield Inc. has been manufacturing its own shades for its table lamps. The company is currently operating at $100\%$ of capacity, and

variable manufacturing overhead is charged to production at the rate of $50\%$ of direct labour costs. The direct materials and direct

labour costs per unit to make the lampshades are $$4\mathrm{.}80$ and $$5\mathrm{.}60,$ respectively. Normal production is $50,900$ table lamps per year.

A supplier offers to make the lampshades at a price of $$13\mathrm{.}50$ per unit. If Sheffield Inc. accepts the supplier's offer, all variable

manufacturing costs will be eliminated, but the $$42,300$ of fixed manufacturing overhead currently being charged to the lampshades

will have to be absorbed by other products.

$($a$)$

Prepare the incremental analysis for the decision to make or buy the lampshades. $($Round answers to $0$ decimal places, e$.$g$.5,275.$ 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.$)$

The new machine be purchased.