Rockford company manufactures a part for use in its production of hats. when 10,000 items are produces, the costs per unit are:

Direct materials $0.75

Direct manufacturing labor 3.00

Variable Manufacturing overhead 1.50

Fixed Manufacturing overhead 1.60

Total: $6.85

Angel company has offered to sell to rockford company 10,000 units of the part for $6.00 per unit. the plant facilities could be used to manufacture another item at a savings of $9,000 if rockford accepts the offer. In addition, $1.00 per unit of fixed manufacturing overhead on the original item would be eliminated.

Required:

a. What is the relevant per unit cost for the original part?

b. Which alternative is best for rockford company? By how much?