The Tiger Corporation manufactures $20,000$ rolls of paper each period. The paper is used as an input for producing several other products that Tiger manufactures. The full manufacturing costs for a batch of $100$ rolls of paper are as follows:

Direct materials

$524$

Direct labour

$360$

Variable manufacturing overhead

$499$

Average fixed manufacturing overhead

$663$

Total

$2046$

The fixed manufacturing overhead comprises depreciation expenses related to prior investments in facilities and equipment that are used in the manufacturing of the paper. These assets have no other use than for the manufacturing of the paper.

An outside supplier has offered to sell Tiger the $20,000$ rolls of paper necessary to meet production needs this period for a lump sum of $145807.$ If Tiger accepts this outside supplier's offer, rather than manufacturing in house, the company will be:

Question $4$ Select one:

$158593$ better off

$145807$ worse off

$130793$ better off

$263393$ worse off