Innova uses 1,060 units of the component IMC2 every month to manufacture one of its...
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Innova uses 1,060 units of the component IMC2 every month to manufacture one of its products, The unit costs incurred to manufacture the component are as follows. Direct materias 61.73 40.73 Direct labor 126.5 $228.95 overhead oosts include variable material handling costs or $7.03, which are applied to products on the basis of direct material costs. The remainder or the overhead costs are applied on the basis of direct labor dollars and consist of 60% variable costs and % ed oosts A vender has affered to supaly the IMC2 component at a price af $260 per unit Prepere the incremental analysis for the decisian to make or buy IMC2. Net Income Increase (Decrease) Make IMC2 (per unit) Buy IMC2 (per unit) irect materia Direct labor Material handling Variable owerhead Purchase price Total unit cost Should Innova purchase the component from the outside vender if Innova's capacity remains idle
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