Concept Check Question 7-13 Taser Industries must decide whether to make or buy some of its components. The costs of producing 175,000 battery packs for its product are as follows: Direct Materials 15,000 Direct Labor Variable overhead $6,000 Fixed overhead$9,000 $5,000 The company has an opportunity to purchase the battery packs for $0.18 per unit, which would eliminate all variable costs, and $2,000 of fixed costs. Based on your analysis, what is the net income increase or decrease if the company purchases the battery packs? An increase in net income of $5,500 An increase in net income of $3,500 A decrease in net income of $3,500 An increase in net income of $7,000