Differential Analysis for a Lease or Buy Decision Sloan Corporation is considering new equipment. The equipment can be purchased from an overseas supplier for $3,400. The freight and installation costs for the equipment are $630. If purchased, annual repairs and maintenance are estimated to be $390 per year over the four-year useful life of the equipment. Alternatively, Sloan can lease the equipment from a domestic supplier for $1,580 per year for four years, with no additional costs. Prepare a differential analysis dated December 3, to determine whether Sloan should lease (Alternative 1) or purchase (Alternative 2) the machine. (Hint: This is a "lease or buy decision, which must be analyzed from the perspective of the machine user, as opposed to the machine owner.) If an amount is zero, enter "O". Use a minus sign to indicate a loss. Lease Equipment (Alt. 1) or Buy Equipment (Alt. 2) December 3 2) Differential Effect on Income (Alternative 2) Purchase price Freight and installation Repair and maintenance (4 years) Lease (4 years) Income (loss) Sat 20:51 Cost Method of Costing MyPhone, Inc, uses the product cost method of applying the cost-plus approach cell phones are as follows: to product pricing. The costs of producing and selling 5,180 units of Variable costs Flxed costs: Direct materials Direct labor Factory overhead Selling and admin. exp. $67 per unit Factory overhead $201,900 31 26 23 Selling and admin. exp. 70,900 Total variable cost per unit $147 per unit MyPhone desires a profit equal to a 15% rate of return on invested assets of $600,200. a. Determine the amount of desired profit from the production and sale of 5,180 units of cell phones. 90,030 b. Determine the product cost per unit for the production of 5,180 of cell phones. If required, round your answer to nearest dollar 163 per unit c. Determine the product cost markup percentage (rounded to two decimal places) for cell phones. 10 X % d. Determine the selling price of cell phones. Round to the nearest dollar. Total Cost Markup Selling price per unit per unit per unit