Differential Analysis Involving Opportunity Costs On July 1, Matrix Stores Inc. is considering leasing a building and buying the necessary equipment to operate a public warehouse. Alternatively, the company could use the funds to invest in $151,600 of 6% U.S. Treasury bonds that mature in 16 years. The bonds could be purchased at face value. The following data have been assembled: Cost of store equipment Life of store equipment Estimated residual value of store equipment Yearly costs to operate the warehouse, excluding $151,600 16 years $19,000 depreciation of equipment Yearly expected revenues-years 1-8 Yearly expected revenues-years 9-16 $55,800 74,400 70,200 Required: 1. Prepare a differential analysis as of July 1 presenting the proposed operation of the warehouse for the 16 years (Alternative 1) as compared with investing in U.S. Treasury bonds (Alternative 2). If an amount is zero, enter "0". If required, use a minus sign to indicate a loss. Differential Analysis Operate Warehouse (Alt. 1) or Invest in Bonds (Alt. 2) July 1 Operate Warehouse Invest in Bonds Differential Effects Revenues Costs: (Alternative 1) (Alternative 2) (Alternative 2). Costs to operate warehouse Cost of equipment less residual value Profit (Loss) 2. Based on the results disclosed by the differential analysis, should the proposal be accepted? 3. If the proposal is accepted, what is the total estimated operating income of the warehouse for 16 years? Accept Business at Special Price Product A is normally sold for $46 per unit. A special price of $34 is offered for the export market. The variable production cost is $25 per unit. An additional export tariff of 15% of revenue must be paid for all export products. Assume there is sufficient capacity for the special order. a. Prepare a differential analysis dated March 16 on whether to reject (Alternative 1) or accept (Alternative 2) the special order. If required, round your answers to Iwo decimal places. If an amount is zero, enter "0". Differential Analysis Reject Order (Alt. 1) or Accept Order (Alt. 2) March 16 Reject Order Accept Order Differential Effects (Alternative 1) (Alternative 2) (Alternative 2). Revenues, per unit Costs: Variable manufacturing costs, per unit Export tariff, per unit Profit (loss), per unit b. Should the special order be rejected (Alternative 1) or accepted (Alternative 2)7