Collins Company Uses 12,000 Units of a Part in Its

Multiple Choice

Collins Company uses 12,000 units of a part in its production process.The costs to make a part are: direct material,$15;direct labor,$27;variable overhead,$15;and applied fixed overhead,$32.Eichholtz has received a quote of $60 from a potential supplier for this part.If Collins buys the part,75 percent of the applied fixed overhead would continue.Collins Company would be better off by

A) $30,000 to manufacture the part.
B) $348,000 to buy the part.
C) $60,000 to buy the part.
D) $216,000 to manufacture the part.