Problem: Diamond Brands manufactures riMagic Fun has total fixed costs of $4,000,000 and total variable cost of $2,000,000 during a month when it sold 200,000 units. What price will Magic Fun charge if it uses cost-plus pricing and a markup of 20%?ce, wheat, and oat cereals. Sanders Company has approached Diamond Brands with a proposal to sell the company the rice cereals at a price of $22,000 for 20,000 pounds. The following costs are associated with production of 20,000 pounds of rice cereal: Direct material $13,000 Direct labor 5,000 Manufacturing overhead 7,000 Total $25,000 The manufacturing overhead consists of $2,000 of variable costs with the balance being allocated fixed costs. Should Diamond Brands make or buy the rice cereal? Group of answer choices Buy them to save $4,000. Continue to make them because the incremental cost of buying is $2,000. Buy them to save $2,000. Continue to make them because the incremental cost of buying is $22,000.