75. Scarlet Company produces electronic components for electronic systems. The company sells 10,000 components per year for $15. The capacity is 12,500 units per year. Manufacturing and other costs are as follows: Variable costs per unit: Direct materials Direct labor Factory overhead Total Fixed costs per month: $4.50 Factory overhead $60,000 2.25 Selling and admin. 30,000 2.25 $9.00 Total $90,000 Ocher Company has offered a one-year contract to supply the components at a cost of $8.50 per unit. If Scarlet Company accepts the offer, it will be able to rent unused space to an outside firm for $9,000 per year. All other information remains the same. What is the effect on profits if Scarlet Company buys the components from Ocher Company?