Melbourne Corporation has traditionally made a subcomponent of its major product. Annual production of $30,000$ subcomponents results in the following costs:

Direct materials $ $250,000$

Direct labor $ $200,000$

Variable manufacturing overhead $ $190,000$

Fixed manufacturing overhead $ $120,000$

Melbourne has received an offer from an outside supplier who is willing to provide the $30,000$ units of the subcomponent each year at a price of $$28$ per unit. Melbourne knows that the facilities now being used to manufacture the subcomponent could be rented to another company for $$80,000$ per year if the subcomponent were purchased from the outside supplier. There would be no effect of this decision on the total fixed manufacturing overhead of the company. Assume that direct labor is a variable cost.

At what price per unit charged by the outside supplier would Melbourne be indifferent between making or buying the subcomponent?

Multiple Choice

$$29$ per unit

$$25$ per unit

$$21$ per unit

$$24$ per unit