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wheel assemblies to Mobility. If Mobility makes the assembly, Its cost per rear wheel assembly...

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Accounting

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wheel assemblies to Mobility. If Mobility makes the assembly, Its cost per rear wheel assembly is as follows (based on annual production of 1,800 units): Direct materials Direct labor Variable overhead Fixed overhead Total $ 29 9 5 19 42 $185 Trailblazers has offered to sell the assembly to Mobility for $156 each. The total order would amount to 1,800 rear wheel assemblies per year, which Mobility's management will buy Instead of make if Mobility can save at least $20,000 per year. Accepting Trailblazers's offer would eliminate annual fixed overhead of $35,350. Required: a. Prepare a schedule that shows the total differential costs. (Select option "higher" or "lower", keeping Status Quo as the base. Select "none" If there is no effect.) Answer is not complete. Status Alternative Difference Quo Trailblazers' offer Materials Labor Variable overhead Fixed overhead applied Total costs T $ 0 $ 0 b. Should Mobility make rear wheel assemblies or buy them from Trailblazers? Make Buy

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