Anderson Company Uses 10,000 Units of a Part in Its

Multiple Choice

Anderson Company uses 10,000 units of a part in its production process.The costs to make a part are: direct material,$12; direct labor,$25; variable overhead,$13; and applied fixed overhead,$30.Anderson has received a quote of $55 from a potential supplier for this part.If Anderson buys the part,70 percent of the applied fixed overhead would continue.Anderson Company would be better off by

A) $50,000 to manufacture the part.
B) $150,000 to buy the part.
C) $40,000 to buy the part.
D) $160,000 to manufacture the part.