Benjamin O'Henry has owned and operated O'Henry's Data Services since its beginning ten years ago. From all appearances, the business has prospered. In the past few years, you have become friends with O'Henry and his wife through your church. Recently. O'Henry mentioned that he has lost his zest for the business and would consider selling it for the right price. You are interested in buying this business and obtain its most recent monthly unadjusted trial balance, which follows.

O'HENRY'S DATA SERVICES Unadjusted Trial Balance November 30, 20XX Cash $ 9,700 Accounts receivable Prepaid expenses Accumulated depreciation. Accounts payable.. Salary payable.. 7,900 Furniture, fixtures, and equipment. 2,600 151,300 $ 15.600 3.800 Unearned service revenue Benjamin O'Henry, capital.. 6,700 137.400 Benjamin O'Henry, withdrawals 2.000 Service revenue. 14.300 Rent expense.... Salary expense. Utilities expense. 3,400 900 Depreciation expense Supplies expense Total.. $177.800 $177,800 Revenues and expenses vary little from month to month, and November is a typical month. Your investigation reveals that the unadjusted trial balance does not include the effects of monthly revenues of $2,100 and monthly expenses totaling $2,750. If you were to buy O'Henry's Data Services, you would hire a manager who would require a monthly salary of $3,000. Required 1. The most you would pay for the business is 20 times the monthly net income you could expect to earn from it. Compute this possible price. 2. The least O'Henry will take for the business is his ending capital. Compute this amount. 3. Under these conditions, how much should you offer O'Henry? Give your reason.