Shari Company incurs the following costs in producing 5,000 units of product:

Direct materials $30,000

Direct labor 22,000

Variable manufacturing overhead 17,000

Fixed manufacturing overhead 12,000

An outside supplier has offered to supply the 5,000 units at $14.00 each. Of the fixed costs, $4,000 of the fixed costs would be eliminated if the offer is accepted. Acceptance will result in a

	a.	savings of $3,000.
	b.	loss of $11,000.
	c.	savings of $7,000.
	d.	loss of $1,000.