Han-8731 company manufactures 36,000 units of part T-25 each year. The company's cost per unit for part T-25 is:



Direct materials $ 4.00
Direct labor 8.00
Variable manufacturing overhead 2.00
Fixed manufacturing overhead 9.00
Total cost per part $ 23.00


An outside supplier has offered to sell 36,000 units of part T-25 each year to Han-8731 for $19 per unit. If Han-8731 accepts this offer, it can rent out the facilities now being used to manufacture part T-25 to another company at an annual rental of $86,000. However, Han-8731 has calculated that two-thirds of the fixed manufacturing overhead being applied to part T-25 will continue even if the part is bought from the outside supplier.



What is the financial advantage of accepting the outside supplier’s offer?


multiple choice
$17,000
$12,000
$14,000
$16,000