Temple, Inc. produces several models of clocks. An outside supplier has offered to produce the commercial clocks for Temple for $350 each. Temple needs 500 clocks annually. Temple has provided the following unit costs for its commercial clocks:

Direct materials	$ 70
Direct labour	80
Variable overhead	75
Fixed overhead (30% avoidable)	120

Prepare an incremental analysis which shows the effect of the make or buy decision.

		$175,000
		$130,500
		$44,500
		$11,000