HHL outsourced its IT department and chose contract bid 1($250,000 initial cost, $100,000 annual payment). Using the chosen contract for bid 1, record the transaction for O.

Verizon 12:15 PM 58% Expert Q&A During fiscal year 2019 HHL decides to outsource its information technology services to another company By doing this outsourcing, HHL will be able to get rid of certain services and staff that cost the hospital $175,000 annually. There is an upfront cost to undertaking this venture, because the company must setup servers, backup systems, and e-mail accounts for HHL. Then, there are annual contract payments that HHL must make with the 1T company. The Board of Directors has agreed to a 4-year contract. Management is entertaining two separate bids from two companies. The first requires a $250,000 payment for the initial conversion, and $100,000 per year afterwards. The other bid requires a S350,000 payment upfront, but only $75,000 annually. HHL has a 6% cost of capital. Which option should HHL choose? 0 Expert