X Company currently buys a part from a supplier for $14.84 per unit but is considering making the part itself next year. This year, they purchased 3,200 units of this part; next year, they will need 3,700 units. Estimated costs to make the part next year are:

		Per-Unit	Total
Direct materials		$3.33	$10,656
Direct labor		4.36	13,952
Variable overhead		4.20	13,440
Fixed overhead		4.40	14,080
Total		$16.29	$52,128

Of the estimated fixed overhead, $8,307 would be additional fixed overhead costs; the remainder would be common costs allocated to the part. X Company currently receives $2,800 a year by renting unused factory space, but it will have to use this space to make the part.

If X Company continues to buy the part instead of making it, it will save

A: $91

B: $133

C: $192

D: $279

E: $404

F: $586

Tries 0/99