Factor Company estimates that producing a unit of product would require $7.80 per unit of direct materials and $23.80 per unit of direct labor. Factor Company normally applies overhead using a...

Factor Company estimates that producing a unit of product would require $7.80 per unit of direct materials and $23.80 per unit of direct labor. Factor Company normally applies overhead using a predetermined overhead rate of 150% of direct labor cost. Factor Company estimates incremental overhead of $15.60 per unit of product. An outside supplier offers to provide Factor Company with all the units it needs at a price of $45.20 per unit. Factor Company should choose to: