n Insourcing option Operating Expenses Direct labor Benefits (50%) Direct material Indirect labor Benefits (50%) Equipment depreciation Overhead Engineering/design costs Total cost per unit Outsourcing option Purchase price Shipping and handling Inventory charges Administrative costs Total cost per unit $0.0400 $0.0200 $0.0400 $0.0155 $0.0078 $0.0090 $0.0600 $0.0500 $0.2423 $9,000 absorbed over 1,000,000 units $50,000 absorbed over 1,000,000 units $0.0500 $0.0060 $0.0010 $0.0011 $0.0581 Savings per unit Total savings (1 million units) $0.1842 $184,200 Print Done