Required information Comprehensive Problem 5 (Static) Skip to question [The following information applies to the questions displayed below.] The Gilster Company, a machine tooling firm, has several plants. One plant, located in St. Cloud, Minnesota, uses a job order costing system for its batch production processes. The St. Cloud plant has two departments through which most jobs pass. Plant-wide overhead, which includes the plant managers salary, accounting personnel, cafeteria, and human resources, is budgeted at $250,000. During the past year, actual plantwide overhead was $240,000. Each departments overhead consists primarily of depreciation and other machine-related expenses. Selected budgeted and actual data from the St. Cloud plant for the past year are as follows. Department A Department B Budgeted department overhead (excludes plantwide overhead) $ 150,000 $ 600,000 Actual department overhead 160,000 620,000 Expected total activity: Direct labor hours 35,000 15,000 Machine-hours 10,000 40,000 Actual activity: Direct labor hours 51,000 9,000 Machine-hours 10,500 42,000 For the coming year, the accountants at the St. Cloud plant are in the process of helping the sales force create bids for several jobs. Projected data pertaining only to job no. 110 are as follows. Direct materials $ 25,000 Direct labor cost: Department A (2,200 hr) 45,000 Department B (800 hr) 10,000 Machine-hours projected: Department A 200 Department B 1,200 Units produced 10,000 Comprehensive Problem 5 (Static)

Part f

f. Compute incremental cost (benefit) to make if the St. Cloud plant could use the facilities necessary to produce parts for job no. 110 for another job that could earn an incremental profit of $20,000?

\begin{tabular}{|l|l|} \hline Incremental profit earned by producing the other job \\ \hline Incremental cost of buying the parts from the subcontractor \\ \hline \end{tabular}