The management of Pharoah Manufacturing Company is trying to decide whether to continue manufacturing a part or to buy it from an outside supplier. The part, called CISCO, is a component of the company's finished product. The following information was collected from the accounting records and production data for the year ending December 31,2022 1.8,100 units of CISCO were produced in the Machining Department. 2. Variable manufacturing costs applicable to the production of each CISCO unit were: direct materials $4.65, direct labor $4.46, indirect labor $0.45, utilities $0.38. 3. Fixed manufacturing costs applicable to the production of CISCO were: All variable manufacturing and direct fixed costs will be eliminated if CISCO is purchased. Allocated costs will not be eliminated if CISCO is purchased. So if CISCO is purchased the fixed manufacturing costs allocated to CISCO will have to be absorbed by other production departments. Make CISCO Buy CISCO (Decrease) Direct material Direct labor Indirect labor Utilities Depreciation Property taxes Insurance Purchase price Freight and inspection (b) Based on your analysis, what decision should management make? The company should (c) Would the decision be different if Pharoah Company has the opportunity to produce $3,000 of net income with the facilities currently being used to manufacture CISCO? The management of Pharoah Manufacturing Company is trying to decide whether to continue manufacturing a part or to buy it from an outside supplier. The part, called CISCO, is a component of the company's finished product. The following information was collected from the accounting records and production data for the year ending December 31,2022 1.8,100 units of CISCO were produced in the Machining Department. 2. Variable manufacturing costs applicable to the production of each CISCO unit were: direct materials $4.65, direct labor $4.46, indirect labor $0.45, utilities $0.38. 3. Fixed manufacturing costs applicable to the production of CISCO were: All variable manufacturing and direct fixed costs will be eliminated if CISCO is purchased. Allocated costs will not be eliminated if CISCO is purchased. So if CISCO is purchased the fixed manufacturing costs allocated to CISCO will have to be absorbed by other production departments. Make CISCO Buy CISCO (Decrease) Direct material Direct labor Indirect labor Utilities Depreciation Property taxes Insurance Purchase price Freight and inspection (b) Based on your analysis, what decision should management make? The company should (c) Would the decision be different if Pharoah Company has the opportunity to produce $3,000 of net income with the facilities currently being used to manufacture CISCO