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Each year, Martin Motors surveys 7,000 former and prospective customers regarding satisfaction and brand awareness. For the current year, the company is considering outsourcing the
Each year, Martin Motors surveys 7,000 former and prospective customers regarding satisfaction and brand awareness. For the current year, the company is considering outsourcing the survey to RBG Associates, which has offered to conduct the survey and summarize results for $32,575. Donald Martin, the president of Martin Motors, believes that RBG will do a higher-quality job than his company has been doing but is unwilling to spend more than $10,000 above current costs. The head of bookkeeping for Martin has prepared the following summary of costs related to the survey in the prior year: $15,800 5,500 1,785 Mailing Printing (done by Lester Print Shop) Salary of Pat Fisher, part-time employee who stuffed envelopes and summarized data when surveys were returned (119 hours x $15) Share of depreciation of computer and software used to track survey responses and summarize results Share of electricity/phone/etc. based on square feet of space occupied by Pat Fisher vs. entire company Total 1,150 580 $24,815 What is the incremental cost or savings of going outside vs. conducting the survey as in the past? The incremental v of going outside $ Will Donald Martin accept the RBG offer? Craig Knight v accept the RBG offer
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