Refer to S25-6. What qualitative factors should Riley consider before making her final decision? Exercise S25-6 Rita
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Refer to S25-6. What qualitative factors should Riley consider before making her final decision?
Exercise S25-6
Rita Riley manages a fleet of 200 delivery trucks for Greely Corp. Riley must decide if the company should outsource the fleet management function. If she outsources to Fleet Management Services (FMS), FMS will be responsible for maintenance and scheduling activities. This alternative would require Riley to lay off her five employees. However, her own job would be secure; she would be Greely's liaison with FMS. If she continues to manage the fleet, she will need fleet-management software. Rita gathers the following information:
Suppose that FMS offers to manage this fleet for an annual fee of \(\$ 280,000\). What will be the impact on operating income if Greely outsources the fleet-management services to FMS?
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