13. Marigold Corp. has the following costs when producing 100000 units:

Variable costs	$600000
Fixed costs	900000

An outside supplier is interested in producing the item for Marigold. If the item is produced outside, Marigold could use the released production facilities to make another item that would generate $70000 of net income. At what unit price would Marigold accept the outside suppliers offer if Marigold wanted to increase net income by $40000?

a) $6.70

b) $5.70

c) $7.10

d) $6.30

14. Bonita Industries has the following costs when producing 100000 units:

Variable costs	$600000
Fixed costs	900000

An outside supplier has offered to make the item at $4.50 a unit. If the decision is made to purchase the item outside, current production facilities could be leased to another company for $164000. The net increase (decrease) in the net income of accepting the suppliers offer is

a) $844000.

b) $314000.

c) $(14000).

d) $286000.