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Determine the period of evaluation. Determine the alternatives available for evaluation. Prepare the relevant cost analysis based on future differential cash flows for each alternative,
- Determine the period of evaluation.
- Determine the alternatives available for evaluation.
- Prepare the relevant cost analysis based on future differential cash flows for each alternative, and identify the least cost alternative.
- Assuming no additional information is available, from a purely financial perspective, should Sameer accept FPP's proposal and close down the P&D Department for one year?
5 of 5 A00001 EXHIBIT I: COST STATEMENT FOR THE YEAR 2013* (in INR) Publishing Printing and Distribution Department Department 340,000 288,000 170,000 340,000 1 15,000 150,000 85,000 Cost Particulars Salary & Wages Material & Supplies Depreciation Allocated General Overheads Warehouse Rent 42,000 Other Operating Expenses 96,000 79,000 Total Expenses 848,000 1,020,000 *Summary of the cost statement of the Publishing Department and the Printing and Distribution Department for the year ending December 2013. 48,000 I- l- E I. Source: Case writers
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