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X Company is considering buying a part next year that they currently make. This year's production costs for 3,400 units were as follows: Per-Unit Total

X Company is considering buying a part next year that they currently make. This year's production costs for 3,400 units were as follows:

Per-Unit Total
Direct materials $2.79 $9,486
Direct labor 3.19 10,846
Variable overhead 3.30 11,220
Fixed overhead 5.20 17,680
Total $14.48 $49,232

A company has offered to supply this part to X Company for $12.66 per unit. If X Company accepts the offer, it will avoid fixed costs of $9,724, and it will be able to lease the resources that will become available from not making the part for $2,000. At what production level would X Company be indifferent between making and buying the part next year?

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