Use this data to determine the financial effect if we decide to make the part.

A company has been purchasing a part for $240 per unit. That firm is operating at 80% capacity and is considering using the excess capacity to make the part. The estimated costs associated with making the part internally are as follows:

	Unit Costs
Direct materials	$ 80
Direct labor	$ 80
Variable overhead	$ 62
Fixed overhead	$ 68

		The company would lose $35 per unit by making it internally.
		The company would save $28 per unit by making it internally.
		The company would save $68 per unit by making it internally.
		The company would lose $48 per unit by making it internally.