The following information is for Questions 1 and 2 X Company is considering buying a part next year that they currently make. A company has offered to supply it for $12.75 per unit. This year's production costs for 3,300 units were as follows:

		Per-Unit	Total
Direct materials		$3.95	$13,035
Direct labor		3.11	10,263
Total overhead		7.50	24,750
Total costs		$14.56	$48,048

$10,560 of total overhead is variable. If X Company chooses to buy the part, it will still incur fixed costs of $5,818.

1. If X Company buys the part next year instead of making it, and production is expected to remain at 3,300 units, it will save

A: $155

B: $194

C: $242

D: $303

E: $379

F: $473

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2. If X Company makes the part next year instead of buying it, and production next year is expected to be 3,700 units, it will save

A: $456

B: $516

C: $583

D: $659

E: $744

F: $841

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