Colorado Ski Company makes downhill ski equipment. Assume that New Mexico Ski Company has offered to produce ski poles for Colorado Ski Company for $18 per pair. Colorado Ski Company needs 100,000 pairs of poles per period. Colorado Ski Company can only avoid $125,000 of fixed costs if it outsources; the remaining fixed costs are unavoidable. Colorado Ski Company currently has the following costs at a production level of 100,000 pairs of poles: Manufacturing Costs Direct materials Direct labor Variable MOH Fixed MOH Total Total Cost $750,000 80,000 520,000 650,000 $2,000,000 Cost per Pair $7.50 0.80 5.20 6.50 $20.00 Colorado Ski Company should: Select one: A. Not outsource production because operating income would decline by $325,000 B. Not outsource production because operating loss would increase by 325,000 C. Outsource production because operating income would increase by $325,000 D. Outsource production because operating loss would decline by $325,000