Using the estimated sales and production of 10000 pair of skis as the expected

Using the estimated sales and production of 10000 pair of skis as the expected volume Direct labor $35 Direct material 30 Total overhead 15
Total cost $80 They discussed the purchasing of the binding from a subcontractor at $5.25 per binding or $10.50 per pair with direct-labor and variable cost would be reduced by
10% and direct materials costs would be reduced by 20%. Instead of 10000 pairs of skis revised estimates show sales volume at 12500 pairs. At this new volume additional equipment at an annual rental of 10000 must be
acquired to manufacture the bindings. This incremental cos would be the only additional fixed cost required even if sales increased to 30000 pairs. (The 30000
level is the goal for the third year of production.) Under these circumstances should the Corporation make or buy the bindings? Show calculations to support the
answer.