All-Alone Inc has always manufactured its own parts. The costs per unit for a special part for its main product are as follows: direct materials, $1; direct labor, $10; variable overhead, $5; and fixed overhead, $8.

Let-Me-Help Company has contacted All-Alone with an offer to sell them 5,000 of the special parts for $22 each. All-Alone will eliminate $25,000 of fixed overhead if it accepts the proposal.

What are the relevant internal costs for All-Alone?

Multiple Choice

• $140,000
• none of the answers are correct
• $80,000
• $125,000
• $105,000