The cost structure to manufacture 11,800 of these toy pets is as follows: Direct materials ($30 per pet) Direct labour ($30 per pet) Variable overhead ($12 per pet) Allocated fixed overhead ($20 per pet) Total $354,000 354,000 141,600 236,000 $1,085,600 Buddy Pets is approached by Maxum Inc., which offers to make the toy pets for $85 per unit. Using incremental analysis, determine whether Buddy Pets should accept this offer under each of the following independent assumptic Prepare an incremental analysis. Assume that $118,000 of the fixed overhead cost (in making 11,800 of the toy pets) is avoidable. Cost Make Buy Cost (Saving) Total annual cost Should Buddy Pets continue to make the pets or buy the pets? Buddy Pets should the pets