Blossom industries incurs unit costs of $7 ($4 variable and $3 fixed) in making an assembly part for it finished product. A supplier offers to make 10,900 of the assembly part at $5 per unit. If the offer is accepted, blossom will save all variable costs but no fixed costs.

Prepare an analysis showing the total cost saving, if any, that blossom will realize by buying the part.

Current Attempt in Progress Blossom Industries incurs unit costs of $7 ($4 variable and $3 fixed) in making an assembly part for its finished product. A supplier offers to make 10,900 of the assembly part at $5 per unit. If the offer is accepted, Blossom will save all variable costs but no fixed costs. Prepare an analysis showing the total cost saving, if any, that Blossom will realize by buying the part. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net Income Make Buy Increase (Decrease) Variable manufacturing costs $ $ to Fixed manufacturing costs Purchase price Total annual cost $ $ $ The decision should be to V the part