Oolong, Inc. can produce 100 units of a component part with the following costs:

Direct Materials.......... $15,000 Direct Labor.......... 6,500 Variable Overhead.......... 16,000 Fixed Overhead.......... 11,000

If Oolong can purchase the component part externally for $44,000 and only $4,000 of the fixed costs can be avoided, what is the correct make-or-buy decision?

Group of answer choices

Buy and save $500

Make and save $2,500

Make and save $500

Buy and save $6,500