Wilma Company must decide whether to make or buy some of its components. The costs of producing 60,000 switches for its generators are as follows.

Direct materials		$30,000		Variable overhead		$45,000
Direct labor		$42,000		Fixed overhead		$60,000

Instead of making the switches at an average cost of $2.95 ($177,000 60,000), the company has an opportunity to buy the switches at $2.7 per unit. If the company purchases the switches, all the variable costs and one-fourth of the fixed costs will be eliminated.

Prepare an incremental analysis showing whether the company should buy the switches. (Enter negative amounts using either a negative s e.g.-45 or parentheses e.g. (45).) Make Buy Increase (Decrease) Direct materials Direct labor Variable manufacturing costs Fixed manufacturing costs Purchase price Total cost Wilma Company will incur$ of additional costs if it the switches