Given the following, determine if the company should buy 3,000 units at $4.00 per unit...

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Accounting

Given the following, determine if the company should buy 3,000 units at $4.00 per unit or if the company should continue to make the 3,000 units.
Direct materials ($1.00 per unit)
$3,000
Labor ($1.60 per unit)
$4,800
Variable overhead ($1.10 per unit)
$3,300
Fixed overhead
$1,500
Common costs
$2,000
If the company buys the component, all of the variable costs and fixed overhead costs are differential. None of the common costs will be eliminated if the component is purchased. Based on price, what should the company do?

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