Champ Manufacturing produces a variety of high$-$precision manufacturing equipment. The company is considering

purchasing one component part from an outside supplier instead of making it in$-$house. The following financial

information is available for the component part:

Of the fixed traceable overhead, $20\%$ is for supervisor salaries and the other $80\%$ is for depreciation of equipment, which has no resale value.

The outside supplier has offered to sell the component for $$350$ per unit.

Required:

Should Champ Manufacturing continue to produce the component in$-$house or should they accept the outside offer?

Written description if outside offer should be accepted or not and why?