Current Attempt in Progress Splish College provides its own housekeeping services. The College director would like to outsource this service and has found a company that will provide the service for $49 per hour. The following information has been collected about the cost per hour to the college for performing its own housekeeping services Cost per hour of service: Cleaning supplies $3 Direct labour costs $27 Variable overhead $1 Total hours of housekeeping services per year 3,040 Total fixed overhead $55,080 (a) Your answer is partially correct Determine whether Splish College should outsource housekeeping, assuming that 50% of fixed costs can be eliminated if the service is outsourced. (If an amount reduces the net income then enter with a negative sign preceding the number, eg-15,000 or parenthesis, eg (15,000). While alternate approaches are possible, irrelevant fixed costs should be included in both options when solving this problem.) amber of hours: 040 In-house eaning supplies rect labour iriable overhead ked costs irchase price tal cost Splish College should not outsource the services. Outsource Net Income Increase (Decrease) eTextbook and Media Save for Later Last saved 5 hours ago. Attempts: 1 of 4 used Submit Answer Saved work will be auto-submitted on the due date. Auto- submission can take up to 10 minutes.
Current Attempt in Progress Splish College provides its own housekeeping services. The College director would like to outsource this service and has found a company that will provide the service for $49 per hour. The following information has been collected about the cost per hour to the college for performing its own housekeeping services Cost per hour of service: Cleaning supplies $3 Direct labour costs $27 Variable overhead $1 Total hours of housekeeping services per year 3,040 Total fixed overhead $55,080 (a) Your answer is partially correct Determine whether Splish College should outsource housekeeping, assuming that 50% of fixed costs can be eliminated if the service is outsourced. (If an amount reduces the net income then enter with a negative sign preceding the number, eg-15,000 or parenthesis, eg (15,000). While alternate approaches are possible, irrelevant fixed costs should be included in both options when solving this problem.) amber of hours: 040 In-house eaning supplies rect labour iriable overhead ked costs irchase price tal cost Splish College should not outsource the services. Outsource Net Income Increase (Decrease) eTextbook and Media Save for Later Last saved 5 hours ago. Attempts: 1 of 4 used Submit Answer Saved work will be auto-submitted on the due date. Auto- submission can take up to 10 minutes.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Current Attempt in Progress
Splish College provides its own housekeeping services. The College director would like to outsource this service and has found a
company that will provide the service for $49 per hour. The following information has been collected about the cost per hour to the
college for performing its own housekeeping services
Cost per hour of service:
Cleaning supplies
$3
Direct labour costs
$27
Variable overhead
$1
Total hours of housekeeping services per year
3,040
Total fixed overhead
$55,080
(a)
Your answer is partially correct
Determine whether Splish College should outsource housekeeping, assuming that 50% of fixed costs can be eliminated if the
service is outsourced. (If an amount reduces the net income then enter with a negative sign preceding the number, eg-15,000 or
parenthesis, eg (15,000). While alternate approaches are possible, irrelevant fixed costs should be included in both options when solving
this problem.)
amber of hours:
040
In-house
eaning supplies
rect labour
iriable overhead
ked costs
irchase price
tal cost
Splish College
should not
outsource the services.
Outsource
Net Income
Increase (Decrease)
eTextbook and Media
Save for Later Last saved 5 hours ago.
Attempts: 1 of 4 used
Submit Answer
Saved work will be auto-submitted on the due date. Auto-
submission can take up to 10 minutes.
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