Type or paste question here

Clemente Inc incurs the following costs to produce 10,000 units of a subcomponent: Direct materials $28,000 Direct labor 37,500 Variable overhead 42,000 Fixed overhead 54,000 An outside supplier has offered to sell Clemente the subcomponent for $9.50 a unit. If Clemente accepts the offer, it could use the production capacity to produce another product that would generate additional income of $12,000. The increase (decrease) in net income from accepting the offer would be Select one: a. $500. b. $24,500. c. $(500). d. $(12,000)