TechSystems manufactures an optical switch that it uses in its final product. TechSystems incurred the following manufacturing costs when it produced 67,000 units last year: (Click the icon to view the manufacturing costs.) Another company has offered to sell Tech Systems the switch for $11.50 per unit. If TechSystems buys the switch from the outside supplier, none of the fixed costs are avoidable. The company prepared an outsourcing decision analysis to show the cost per unit of making the switches versus the cost per unit of buying (outsourcing) the switches. (Click the icon to view the outsourcing decision analysis.) TechSystems needs 80,000 optical switches next year (assume same relevant range). By outsourcing them, TechSystems can use its idle facilities to manufacture another product that will contribute $218,000 to operating income, but none of the fixed costs will be avoidable. Should Tech Systems make or buy the switches? Show your analysis. Complete the Best Use of Facilities Analysis. (Enter a "0" for any zero amounts.) TechSystems Best Use of Facilities Analysis Buy and Use Facilities for Other Product Make Total variable cost of obtaining the optical switches Expected net cost of obtaining the optical switches of 1 pt 9 of 10 (2 complete) HW Score: 18.75%, 1.88 A (simi uestion Help 0 Data Table ing decision ems manu roduct. Ted uring costs Direct materials Direct labor Variable MOH k the icon to company ha $11.50 pe outside sug 3. The com to show the le cost per 670,000 67,000 201,000 368,500 1,306,500 ches next ye ourcing them manufactul B,000 to oper be avoidable switches? Sh Fixed MOH Total manufacturing cost for 67,000 units Data Table Difference Tech Systems Incremental Analysis for Outsourcing Decision Make Buy Unit Unit Variable cost per unit: Direct materials 10.00 $ 0.00 $ Direct labor 1.00 0.00 Variable overhead 3.00 0.00 Purchase price from outsider 0.00 11.50 Variable cost per unit 14.00 $ 11.50 $ 10.00 1.00 3.00 (11.50) 2.50 Print Done