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  3. green company produces 100 parts per year, which a

Green Company produces 100 parts per year, which are used in the assembly of one...

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Accounting

Green Company produces 100 parts per year, which are used in the assembly of one of its products. The unit product cost of these parts is:

Variable manufacturing cost $12

Fixed manufacturing cost $9

Unit product cost $21

The part can be purchased from an outside supplier at $18 per unit. If the part is purchased from the outside supplier, $500 of the fixed manufacturing costs can be eliminated. What would happen to the cost of 100 units if the company decided to purchase the parts from the supplier?

A. $200 increase in cost

b. $300 decrease in cost

c. $200 increase in cost

d.$100 increase in cost

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