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Wilma Company must decide whether to make or buy some of its components. The costs of producing 69,800 switches for its generators are as follows.
Wilma Company must decide whether to make or buy some of its components. The costs of producing 69,800 switches for its generators are as follows. Direct materials$29,700 Direct labor Variable overhead $45,400 $80,400 51,806 Fixed overhead Instead of making the switches at an average cost of $2.97 $207,306 69,800 one-fourth of the fixed costs will be eliminated. the company has an opportunity to buy the switches at $2.74 per unit. If the company purchases the switches, all the variable costs and Prepare an incremental analysis showing whether the company should buy the switches. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g.(45) Net Income Increase (Decrease) Make Buy Direct materials Direct labor Variable manufacturing costs Fixed manufacturing costs Purchase price Total cost 29700 $ 51806 45400 80400 29700 51806 45400 207306 $ Wilma Company will incur $ of additional costs if it the switches. Would your answer be different if the released productive capacity will generate additional income of $48,746 (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) Net Income Make Buy Total Cost Opportunity cost Total cost 730 $ the answer is . The analysis shows that net income will be by s
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