Sardi inc. is considering whether to continue to make a component or to buy it from an outside supplier. the company uses 13,400 of the components each year. the unit product cost of the component according to the company's cost accounting system is given as follows: direct materials $ 9.20 direct labor 6.20 variable manufacturing overhead 2.00 fixed manufacturing overhead 4.00 unit product cost $ 21.40 assume that direct labor is a variable cost. of the fixed manufacturing overhead, 35% is avoidable if the component were bought from the outside supplier. in addition, making the component uses 1 minutes on the machine that is the company's current constraint. if the component were bought, time would be freed up for use on another product that requires 2 minutes on this machine and that has a contribution margin of $5.60 per unit. when deciding whether to make or buy the component, what cost of making the component should be compared to the price of buying the component

Bridgeport company began operations at the beginning of 2018. the following information pertains to this company. 1. pretax financial income for 2018 is $115,000. 2. the tax rate enacted for 2018 and future years is 40%. 3. differences between the 2018 income statement and tax return are listed below: (a) warranty expense accrued for financial reporting purposes amounts to $7,500. warranty deductions per the tax return amount to $2,200. (b) gross profit on construction contracts using the percentage-of-completion method per books amounts to $94,700. gross profit on construction contracts for tax purposes amounts to $67,100. (c) depreciation of property, plant, and equipment for financial reporting purposes amounts to $61,800. depreciation of these assets amounts to $75,700 for the tax return. (d) a $3,600 fine paid for violation of pollution laws was deducted in computing pretax financial income. (e) interest revenue recognized on an investment in tax-exempt municipal bonds amounts to $1,500. 4. taxable income is expected for the next few years. (assume (a) is short-term in nature; assume (b) and (c) are long-term in nature.) (a) prepare the reconciliation schedule for 2017 and future years. (b) prepare the journal entry to record income tax expense for 2017. (c) prepare the income tax expense section of the income statement beginning with “income before income taxes.” (d) determine how the deferred taxes will appear on the balance sheet at the end of 2017.