Shamrock Manufacturing incurs unit costs of $7.20 ($5.20 variable and $2.00 fixed) in making a sub-assembly part for its finished product. A supplier offers to make 12,600 of the parts for $5.80 per unit. If it accepts the offer, Shamrock will save all variable costs and $1.00 of fixed costs. Prepare an analysis showing the total cost savings, if any, that Shamrock will realize by buying the part. (Round per unit answers to 2 decimal places, e.g. 15.25. If an amount reduces the net income then enter with a negative sign preceding the number, e.g. -15,000, or parenthesis, e.g. (15,000).)

Per Unit Make Number of units:

Number of units:

4

The decision should be to