PLEASE SUBMIT THE ANSWER IN THE SAME LAYOUT THE IMAGE BELOW IS IN.... The Theate

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PLEASE SUBMIT THE ANSWER IN THE SAME LAYOUT THE IMAGE BELOW IS IN....

The Theater Arts Guild of Dallas (TAG-D) employs five people in its Publication Department. These people lay out pages for pamphlets, brochures, magazines, and other publications for the TAG-D productions. The pages are delivered to an outside company for printing. The company is considering an outside publication service for the layout work. The outside service is quoting a price of $13 per layout page. The budget for the Publication Department for 2014 is as follows:

The department expects to lay out 25,000 pages for 2014. The computers used by the department have an estimated residual value of $9,000. The Publication Department office space and equipment would be used for future administrative needs, if the department's function were purchased from the outside.

Salaries $224,000 Benefits 36,000 Supplies 21,000 Office Expenses 39,000 Office Depreciation 28,000 Computer Depreciation 24,000 Total $372,000 The Theater Arts Guild of Dallas (TAG-D) employs five people in its Publication Department. These people lay out pages for pamphlets, brochures, magazines, and other publications for the TAG-D productions. The pages are delivered to an outside company for printing. The company is considering an outside publication service for the layout work. The outside service is quoting a price of $13 per layout page. The budget for the Publication Department for 2014 is as follows: Salaries $224,000 Benefits 36,000 Supplies 21,000 Office Expenses 39,000 Office Depreciation 28,000 Computer Depreciation 24,000 Total $372,000 The department expects to lay out 25,000 pages for 2014. The computers used by the department have an estimated residual value of $9,000. The Publication Department office space and equipment would be used for future administrative needs, if the department's function were purchased from the outside. Prepare a differential analysis dated February 22, 2014, to determine whether TAG-D should lay out pages internally (Alternative 1) or purchase layout services from the outside Alternative 2). If an amount is zero, enter zero 0.

Explanation / Answer

Answer:

Layout pages (Alt 1) Purchase layout services (Alt 2) Differential effect on income Revenue Salvage value of computer equipment 9000 9000 Costs: Purchase price of layout work -325000 -325000 Salaries -224000 224000 Benefits -36000 36000 Supplies -21000 21000 Office expense -39000 39000 Office depreciation -28000 -28000 0 Computer depreciation -24000 -24000 0 Income (Loss) -372000 -368000 4000

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