Direct materials $35000 Direct labor 15000 Variable manufacturing overhead 10

Direct materials $35000
Direct labor 15000
Variable manufacturing overhead 10000
Fixed manufacturing overhead 20000
$80000 Another company has offered to sell the same component part to the company for $12.00 per unit. The fixed manufacturing overhead consists mainly of depreciation on
the equipment used to manufacture the part and would not be reduced if the component part was purchased from the outside firm. If the component part is purchased
from the outside firm Barnes Company has the opportunity to use the factory equipment to produce another product which is estimated to have a contribution margin
of $16000. Instructions
Prepare an incremental analysis report for Barnes Company which can serve as informational input into this make or buy decision.