Mighty Safe Fire Alarm is currently buying 50,000 motherboards from MotherBoard, Inc. at a price of $65.00 per board. Mighty Safe is considering making its own motherboards. The costs to make the motherboards are as follows: direct materials, $32.00 per unit; direct labor, $10.00 per unit; and variable factory overhead, $16.00 per unit. Fixed costs for the plant would increase by $75,000.

Which option should be selected and why?

a.buy, $275,000 more in profits

b.buy, $75,000 more in profits

c.make, $350,000 increase in profits

d.make, $275,000 increase in profits