JFK Manufacturing Corp. is using 10,000 units of part no. 300 as a component to assemble one of its products. It costs the company $18 per unit to produce it internally, computed as follows:

Direct materials	$ 45,000
Direct labor	50,000
Variable overhead	40,000
Fixed overhead	45,000
Total cost	$180.000

An outside vendor has just offered to supply the part for $16 per unit. If the company stops producing this part, one-third of the fixed overhead would be avoided. Should the company make or buy?