Bannister Co. is thinking about having one of its products manufactured by a subcontractor. Currently, the cost of manufacturing 1,000 units follows: Direct material $ 45,000 Direct labor 30,000 Factory overhead (30% is variable) 98,000 If Bannister can buy 1,000 units from an outside supplier for $100,000, it should: Multiple Choice Make the product because current factory overhead is less than $100,000. Make the product because the cost of direct material plus direct labor of manufacturing is less than $100,000. Buy the product because the total incremental costs of manufacturing are greater than $100,000. Buy the product because total fixed and variable manufacturing costs are greater than $100,000. Make the product because factory overhead is a sunk cost.
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