Eggers Company needs 30,000 units of a part to use in producing one of its products. If Eggers buys the part from McMillan Company for $125 instead of making it, Eggers will not use the released facilities in another manufacturing activity. Forty percent of the fixed overhead will continue irrespective of CEO Donald Mickeys decision. The cost data are Cost to make the part: Direct materials $48 Direct labor 21 Variable overhead 29 Fixed overhead 30 $128

Required: Determine which alternative is more attractive to Eggers Buys the part from McMillan Co or make the part? and by what amount/savings?