III- Watson, Inc., manufactures a variety of heavy equipment. The company is currently manufacturing all of its own component parts. An outside supplier has offered to sell engines for $205 per unit. To evaluate this offer, Watson, Inc., has gathered the following information relating to its own cost of producing the engine internally: Per Unit 200 Units per Year Direct materials $ 100 $ 20,000 Direct labor 12,000 Variable manufacturing 30 6,000 overhead Fixed manufacturing overhead, 10* 2,000 traceable Fixed manufacturing overhead, 25 5,000 common, but allocated Total cost $225 $45,000 *40% supervisory salaries; 60% depreciation of special equipment (no resale value). Assuming that the company has no alternative use for the facilities now being used to produce the engine,(Fixed manufacturing overhead, common will be paid anyway), should the outside supplier's offer be accepted? Show all computations. (3pts)