I need an answer for number 3, please, thank you! Cha Inc uses 10 units of part A23 each month in the production of radar equipment. The cost ofmanufacturing one unit of A23 is the following:Direct materialMaterial handling (20% of DMC)P1,000200Direct labor8,00012,000P21,200МОНTMCMaterial handling represents the direct variable costs of the Receiving Dept. that are applied to directmaterials and purchased component on the basis of their cost. This is a separate charge in addition tomanufacturing overhead. Cha's annual manufacturing overhead is one-third variable and two-thirdfixed. Gale Supply, one Cha's reliable vendors, has offered to supply part number A23 at a unit price ofP15,000.1. If Cha purchases the A23 units from Gale the capacity of Cha used to manufacture these parts wouldbe idle. Should Cha decide to purchase the parts from Gale, the unit cost of A23 increase or decrease bywhat amount?|2. Assume Cha is able to rent out all the idle capacity for P25,000 per month. If Cha decides to purchasethe 10 units from Gale. Cha's monthly cost for A23 would increase or decrease by what amount?3. Assume Cha does not wish to commit rental agreement but could use its idle capacity to manufactureanother product that would contribute P52,000 per month. If Cha elects to manufacture A23 in order tomaintain quality control, what is the net amount of Cha's cost from using the space to manufacture partA23?

Solution: 1) Statememt Showing Comparision for Buy or Made Component: Particular Amount $…

Direct material Material handling (20% of DMC) Direct labor Мон TMC P1,000 200 8,000 12,000 P21,200 Material handling represents the direct variable costs of the Receiving Dept. that are applied to direc haterials and purchased component on the basis of their cost. This is a separate charge in addition t hanufacturing overhead. Cha's annual manufacturing overhead is one-third variable and two-third xed. Gale Supply, one Cha's reliable vendors, has offered to supply part number A23 at a unit price 15,000. . If Cha purchases the A23 units from Gale the capacity of Cha used to manufacture these parts wou e idle. Should Cha decide to purchase the parts from Gale, the unit cost of A23 increase or decrease hat amount?| . Assume Cha is able to rent out all the idle capacity for P25,000 per month. If Cha decides to purcha he 10 units from Gale. Cha's monthly cost for A23 would increase or decrease by what amount? . Assume Cha does not wish to commit rental agreement but could use its idle capacity to manufact nother product that would contribute P52,000 per month. If Cha elects to manufacture A23 in orde