Buddy Company manufactures a part for its production cycle. The costs per unit for5,000 units of the part are asfollows:

Per Unit

Direct materials $3.00

Direct labor $5.00

Variable factory overhead $4.00

Fixed factory overhead $4.00

Total costs $16.00

The fixed factory overhead costs are avoidable. Spalding Company has offered to sell5,000 units of the same part to Buddy Company for$15 per unit. Assuming no other use for thefacilities, Buddy Company should________.

A.

make the part to save$15,000

B.

buy the part from Spalding Company to save$5,000

C.

make the part to save$5,000

D.

buy the part from Spalding Company to save$15,000