Big Red Manufacturer owns a factory that produces 5,000 chips per year that it uses for the production of widgets. BigRed Manufacturer was recently approached by an outside supplier that offered to produce chips at $60 per unit. Purchasing from an outside supplier will give Big Red Manufacturer unused space, which can be rented out for $135,000. BigRed Manufacturer has provided the following information about the costs associated in producing its chips. Per unit costs $5.00 $7.00 $2.50 Costs at production of 5,000 chips $25,000 $35,000 $12,500 Direct materials Direct labour Variable manufacturing overhead Allocated common Fixed manufacturing overhead Total $20 $100,000 $34.50 $172,500 Should BigRed Manufacturer purchase the chips from the outside supplier? Yes, profits would increase by $92,500 if the outside supplier's offer is accepted No, profits would decrease by $92,,500 if the outside supplier's offer is accepted Yes, profits would increase by $7,500 if the outside supplier's offer is accepted No, profits would increase by $7,500 if the outside supplier's offer is accepted