Epsilon currently pays $68 per unit to buy a part for a product it sells. Epsilon has excess capacity, and

Epsilon currently pays $68 per unit to buy a part for a product it sells. Epsilon has excess capacity, and estimates that making the part would incur variable costs of $8 for direct materials and $32 for direct labor. Epsilon’s normal predetermined overhead rate is 150% of direct labor cost, but management computes an incremental overhead rate of $12.80 per unit to make this part. Epsilon should choose to:

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