Assume that a company manufactures numerous component parts, one of which is called Part A. The companys absorption costing system indicates that it costs $23.00 to make one unit of Part A as shown below:

Direct materials	$ 10.00
Direct labor	6.00
Variable overhead	2.00
Fixed overhead	5.00
Total absorption cost per widget	$ 23.00

The company is trying to decide between two alternatives: Alternative 1: Replace the existing equipment with a new piece of equipment that the company would rent for $150,000 per year. The new piece of equipment would be used to make 50,000 units per year and it would reduce Part As direct labor cost per unit by 20% and its variable overhead per unit by 30%. The direct materials cost per unit will remain constant. Alternative 2: Purchase 50,000 units of Part A from a supplier at a cost of $19.00 per unit. What is the financial advantage or (disadvantage) of buying the parts from a supplier?

Group of answer choices

$(20,000)

$20,000

$10,000

$(210,000)