Splish Manufacturing incurs unit costs of $$8\mathrm{.}20($ $$5\mathrm{.}20$ variable and $$3\mathrm{.}00$ fixed$)$ in making a sub$-$assembly part for its finished product.

A supplier offers to make $19,400$ of the parts for $$5\mathrm{.}70$ per unit. If it accepts the offer, Splish will save all variable costs and $$1\mathrm{.}00$ of

fixed costs.

Prepare an analysis showing the total cost savings, if any, that Splish will realize by buying the part. $($Round per unit answers to $2$ decimal

places, e$.$g$.15\mathrm{.}25.$ If an amount reduces the net income then enter with a negative sign preceding the number, e$.$g$.-15,000$ or parenthesis, e$.$g$.$

$(15,000).)$

Per Unit

Make

Number of units:

Variable manufacturing costs

Should we make it or buy it$?$ and calculate variable and fixed cost for both make and buy and how net income decreases