The Northern Ring Company manufactures 2,000 telephones per year. The full manufacturing costs per telephone are as follows:

Direct materials	$ 2
Direct labor	8
Variable manufacturing overhead	6
Average fixed manufacturing overhead	6
Total	$22

The Texas Ring Company has offered to sell Northern Ring Company 2,000 telephones for $15 per unit. If Northern Ring Company accepts the offer, $10,000 of fixed overhead will be eliminated. Northern Ring should:

Select one:

A. Make the telephones; the savings is $12,000

B. Make the telephones; the savings is $2,000

C. Buy the telephones; the savings is $12,000

D. Buy the telephones; the savings is $24,000