X Company is considering buying a part next year that it currently makes. This year's production costs for 3,500 units were:

		Per-Unit	Total
Direct materials		$2.84	$9,940
Direct labor		4.46	15,610
Variable overhead		2.90	10,150
Fixed overhead		3.40	11,900
Total		$13.60	$47,600

A company has offered to supply this part for $14.07 per unit. $5,831 of X Company's fixed overhead are allocated costs that will occur even if they buy the part. But if X Company buys the part, it can rent out the freed-up resources for $2,300. Production next year is expected to be 3,900 units. 1. If X Company continues to make the part instead of buying it, it will save

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2. At what production level would X Company be indifferent between making and buying the part?

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