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Indigo has recently started to manufacture RecRobo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit this information to a mobile phone. The cost structure to manufacture 20,000 RecRobos is as follows: Indigo is approached by Handley Inc., which offers to make RecRobo for $82 per unit or $1,640,000. Using incremental analysis, determine whether Indigo should accept this offer under each of the following independent assumptions: (1) Assume that $240,000 of the fixed overhead cost is avoidable. (If an amount reduces the net income then enter with a negative sign preceding the number e.g. 15,000 or parenthesis, e.g. (15,000). While alternate approaches are possible, irrelevant fixed costs should be included in both options when solving this problem.) Should the offer be accepted? (2) Assume that none of the fixed overhead is avoidable. However, if the robots are purchased from Handley Inc., Indigo can use the released productive resources to generate additional income of $140,000. (If an amount reduces the net income then enter with a negative sign preceding the number e.g. 15,000 or parenthesis, e.g. (15,000). While alternate approaches are possible, irrelevant fixed costs should be included in both options when solving this problem.)

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