Using Incremental Analysis
SE 2. Pices Corporation has assembled the following information related to the purchase of a new automated postage machine:
| Posen Machine | Value Machine | |
| Increase in revenue | $44,200 | $49,300 |
| Increase in annual operating costs | ||
| Direct materials | 12,200 | 12,200 |
| Direct labor | 10,200 | 10,600 |
| Variable overhead | 24,500 | 26,900 |
| Fixed overhead (including depreciation) | 12,400 | 12,400 |
Using incremental analysis and only relevant information, compute the difference in favor of the Value machine.
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