Sunland, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit this information to a smartphone. The cost structure to manufacture 20,800 Tri-Robos is as follows. Direct materials ($50 per robot) Direct labor ($40 per robot) Variable overhead ($6 per robot) Allocated fixed overhead ($29 per robot) Total Following are independent assumptions. Sunland is approached by Tienh Inc., which offers to make Tri-Robo for $115 per unit or $2,392,000. Your answer is partially correct. Direct materials Assume that none of the fixed overhead can be avoided. However, if the robots are purchased from Tienh Inc., Sunland can use the released productive resources to generate additional income of $375,000. (Enter negative amounts using either a negative sign preceding the number eg.-45 or parentheses eg. (45).) Direct labor Variable overhead Fixed overhead Opportunity cost Purchase price Totals $ Make Cost $1,040,000 832,000 124,800 375000 i 603,200 $2,600,000 0 $ Buy 0 0 $ Based on the above assumptions, indicate whether the offer should be accepted or rejected? Net Income Increase (Decrease) 375000

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Select the best answer for each of the follwing items and give reasons for your choice. a. Which of the following best describes the relationship between assurance services and attest services? (1) While attest services involved financial data, assurance services involve nonfinancial data (2) While attest services require objectivity, assurance services do not require objectivity (3) All attest services require independence. (4) Attest and assurance services are different terms referring to the same types of services