Windsor Company must decide whether to make or buy some of its components. The costs of producing 59,300 switches for its generators are as follows.

Direct materials		$30,243		Variable overhead		$53,370
Direct labour		42,696		Fixed overhead		60,486

Instead of making the switches at an average cost of $3.15 ($186,795 59,300), the company has an opportunity to buy the switches at $2.95 per unit. If the company purchases the switches, all the variable costs and one-third of the fixed costs will be eliminated.

(a)

Prepare an incremental analysis showing whether the company should make or buy the switches. (Round per unit answers to 2 decimal places, e.g. 15.25. If an amount reduces the net income then enter with a negative sign preceding the number e.g. -15,000 or parenthesis, e.g. (15,000).)

				Per Unit		Make		Buy		Net Income Increase (Decrease)
Number of units:		enter a number of units
select an item Purchase priceCost of good soldManufacturing overheadTotal annual costVariable manufacturing costsFixed manufacturing costs				$enter a dollar amount rounded to 2 decimal places		$enter a dollar amount		$enter a dollar amount		$enter a dollar amount
select an item Manufacturing overheadPurchase priceFixed manufacturing costsVariable manufacturing costsCost of good soldTotal annual cost				enter a dollar amount rounded to 2 decimal places		enter a dollar amount		enter a dollar amount		enter a dollar amount
select an item Variable manufacturing costsPurchase priceFixed manufacturing costsManufacturing overheadCost of good soldTotal annual cost				enter a dollar amount rounded to 2 decimal places		enter a dollar amount		enter a dollar amount		enter a dollar amount
select a closing name Manufacturing overheadCost of good soldPurchase priceVariable manufacturing costsTotal annual costFixed manufacturing costs						$enter a total amount		$enter a total amount		$enter a total amount