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Somerset Computer Company has been purchasing carrying cases for its portable computers at a purchase price of $57 per unit. The company, which is currently

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Somerset Computer Company has been purchasing carrying cases for its portable computers at a purchase price of $57 per unit. The company, which is currently operating below full capacity, charges factory overhead to production at the rate of 36% of direct labor cost. The unit costs to produce comparable carrying cases are expected to be as follows: If Somerset Computer Company manufactures the carrying cases, fixed factory overhead costs will not increase and variable factory overhead costs associated with the cases are expected to be 12% of the direct labor costs. Make Carrying Case (Alt. 1) or Buy Carrying Case (Alt. 2)

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