Clemente Inc. incurs the following costs to produce 10,000 units of a subcomponent:

Direct materials	$8,400
Direct labor	11,250
Variable overhead	12,600
Fixed overhead	16,200

An outside supplier has offered to sell Clemente the subcomponent for $2.85 a unit.

Reference: Ref 7-2

If Clemente accepts the offer, by how much will net income increase (decrease)?

Select one:

a. $3,750

b. $19,950

c. $(8,850)

d. $(2,850)