RESOURCESDo Itf Review 20-3 (Part Level Submission Wilma Company must decide whe

Question

RESOURCESDo Itf Review 20-3 (Part Level Submission Wilma Company must decide whether to make or buy some of its components. The costs of producing 60,500 switches for ework as follows. ise 20-4 ise 20-5 ise 20-2 cise 20-8 Direct materials $29,600 Variable overhead $44,400 Direct labor $21,480 Fixed overhead $83,600 Instead of making the switches at an average cost of $2.96 ($179,080+60,500), the company has an opportunity to bu $2.70 per unit. If the company purchases the switches, all the variable costs and one-fourth of the fxed costs will be eliminated.sa iew 20- l Submission Prepare an incremental anal sign preceding the number e.g. -45 or parentheses e.g. (45).) ysis showing whether the company should buy the switches. (Enter negative amounts using either a Net Income Increase (Decrease) 20-2 Make Buy 20-5 Direct materials Direct labor Variable manufacturing costs Fixed manufacturing costs Purchase price Total cost sults by ective Wilma Company will incur $ of additional costs if it the switches. Click if you would like to Show Work for this question: LINK TO TEXT

Explanation / Answer

Dear Student Thank you for using Chegg Please find below the answer Statementshowing Computations Paticulars Make Buy Net Income Increase (Decrease) Direct materials            29,600.00            29,600.00 Direct Labour            21,480.00            21,480.00 Variable Manufacturing overhead            44,400.00            44,400.00 Fixed manufacturing overhead              83,600.00          62,700.00            20,900.00 Purchase price =2.70*60,500        163,350.00        (163,350.00) Total Relevant cost          179,080.00        226,050.00          (46,970.00) Wilma company will incur 46,970 of additional costs if it buy the switches

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