Topsy Turvy Burger Co. (TTBC) is currently making all of its burger patties in-house by hand using premium ingredients. It makes and sells 50,000 patties per year. The patty is used in most of the menu items at TTBC. The breakdown of the cost per patty is shown below. Food costs Direct labour $1.50 2.50 Variable costs 1.00 Fixed costs Unit cost 0.50 $5.50 The fixed cost (at $0.50/unit) would still remain with the company even if TTBC stops manufacturing the patty. An outside supplier has offered to sell a similar patty to TTBC for $5.50. The mixer currently used to mix the patty ingredients could be used for other recipes. Required a) Should TTBC make or buy the patty? 202 Relevant Costs and Decision-Making Chapter 8 b) What is the maximum price TTBC should be willing to pay an outside supplier for the patty? c) If TTBC buys the patty for $5.50 instead of making it, by how much will income from operations increase or decrease