Leos Tires is considering buying the tires it uses in the manufacture of remote-controlled cars from an outside vendor. Currently, Leos Tires makes the wheels in its own manufacturing facility. Leos Tires can buy the tires from an outside supplier for $1.15 each. The company uses 450,000 tires each year. Information about Leos Tires cost to manufacture the 450,000 tires is as follows:

	Per Unit	Total
Direct Material	$0.50	$225,000
Direct Labour	$0.10	$45,000
Variable Overhead	$0.40	$180,000
Fixed Overhead	$0.25	$112,500
Total	$1.25	$562,500

Fixed cost for Leos Tires would not change if the company stopped making the tires.

Required: Prepare a relevant cost schedule that indicates whether Leos Tires should buy the tires from the outside supplier or continue to make them.

ALL CALCULATIONS MUST BE SHOWN