Jobs, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan...
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Jobs, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit this information to a smartphone. The cost structure to manufacture 20,700 Tri-Robos is as follows. Direct materials ($49 per robot) Direct labor ($42 per robot) Variable overhead ($5 per robot) Allocated fixed overhead ($29 per robot) Cost $1,014,300 869,400 103,500 600,000 $2,587,200 Total Jobs is approached by Tienh Inc., which offers to make Tri-Robo for $115 per unit or $2,380,500 Following are independent assumptions. Assume that $405,000 of the fixed overhead cost can be avoided. (Enter negative amounts using either a negative sign preceding the number e.g. -15 or parentheses e.g. (15).) Net Income Increase (Decrease) Make Buy Direct materials Direct labor Variable overhead Fixed overhead Purchase price Total annual cost
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