Please complete all steps

InteliSystems manufactures an optical switch that it uses in its final product. InteliSystems incurred the following

manufacturing costs when it produced $70,000$ units last year:

$($Click the icon to view the manufacturing costs.$)$

Read the requirements.

Requirement $1.$ Given the same cost structure, should InteliSystems make or buy the switch? Show your analysis.

Complete an incremental analysis to show whether InteliSystems should make or buy the switch. $($Enter a $"0"$ for any zero amounts. Round amoul

to make.$)$

InteliSystems

Incremental Analysis for Outsourcing Decision

InteliSystems does not yet know how many switches it will need this year; however, another company has offered to

sell InteliSystems the switch for $$8\mathrm{.}50$ per unit. If InteliSystems buys the switch from the outside supplier, the

manufacturing facilities that will be idle cannot be used for any other purpose, yet none of the fixed costs are

avoidable.

Requirements

Given the same cost structure, should InteliSystems make or buy the switch?

Show your analysis.

Now, assume that InteliSystems can avoid $$105,000$ of fixed costs a year by

outsourcing production. In addition, because sales are increasing,

InteliSystems needs $75,000$ switches a year rather than $70,000$ switches. What

should the company do now?

Given the last scenario, what is the most InteliSystems would be willing to pay

to outsource the switches?

Data table