Crane Company produces Optimist sailboats. The costs of producing 126000 tiller extensions for use in the sailboats are as follows:

Direct labor		$315000
Direct materials		378000
Variable overhead		81900
Fixed overhead		233100

An outside supplier has offered to supply the tiller extensions for $907200. If Crane accepts the offer $107100 of fixed costs can be avoided. What is the financial advantage (disadvantage) of accepting the supplier's offer?

($6300)

$25200

($25200)

$6300