Trailblazer Bikes, Inc. uses 10,000 sprockets in its bicycles each year. Sprockets currently cost the company $15 per unit to manufacture, determined as follows:

Direct materials $ 36,000

Direct labor 40,000

Variable manufacturing overhead 24,000

Fixed manufacturing overhead 50,000

Total costs $150,000

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Cost per unit ($150,000/10,000 units) = $15/unit

Trailblazer has been approached by an outside supplier that will provide sprockets at a price of $11 per unit. If Trailblazer stops producing sprockets, the direct materials, direct labor, and variable manufacturing overhead will be eliminated, along with $15,000 of the fixed manufacturing overhead. Analyze the problem to determine whether Trailblazer should make or buy sprockets.

a) Complete the following schedule (15 points). (Some cells should contain zeros).

	Make the part	Buy the part	Difference
Direct materials
Direct labor
Variable overhead
Fixed overhead
Purchase price
Totals