ng Sensor Systems manufactures an optical switch that it uses in its final product Another company has offered to sell Sensor Systems the switch for $21.00 per unit. None of Sensor's foxed costs are avoidable Click the icon to view the outsourcing decision) Sensor Systems needs 85,000 optical switches. By outsourcing them, Sensor Systems can use its idle facilities to manufacture another product that will contribute $221,000 to operating incomo Read the requirements Requirement 1. Identify the expected net costs that Sensor Systems will incur to acquire 85,000 switches under three alternative plans Outsource switches Facilities Idio Make new product Make 8 1.5 Switch costs Variable costs Direct materials Direct labor Variable manufacturing overhead Purchase cost Expected profit contribution from the other product Total expected net cost of the optical switches 21 (21 18.5 21 (21 Data table Make Outsource Difference optical switch optical switch (Make-Outsource) Variable costs: Direct materials 8.00 $ 8.00 Direct labor 1.50 1.50 Variable overhead 9.00 9.00 (21.00) $ 21.00 Purchase price from outsider $ 18.50 $ 21.00 $ (2.50) Differential cost per unit 1. Identify the expected net costs that Sensor Systems will incur to acquire 85,000 switches under three alternative plans: make the switches, buy the switches and leave facilities idle, buy the switches and use the idle facilities to make another product. 2. Which plan makes the best use of Sensor System's facilities? Support your