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Jackson County Senior Services is a nonprofit organization devoted to providing essential services to seniors who live in their own homes within the Jackson County
Jackson County Senior Services is a nonprofit organization devoted to providing essential services to seniors who live in their own homes within the Jackson County area. Three services are provided for seniors (home nursing, meals on wheels, and housekeeping). Data on revenue and expenses for the past year follow: The head administrator of Jackson County Senior Services is concerned about the organization's finances and considers the net operating income of $5,000 last year to be razor-thin. Last year's results were very similar to the results for previous years and are representative of what would be expected in the future. Housekeeping is clearly an area of concern. The depreciation in housekeeping is for a large van that is used to carry the housekeepers and their equipment from job to job. Every two years a new van is required at a cost of $40,000. Thus, depreciation is $20,000 per year. If the program were discontinued, the current van, which is one year old, would be donated to a charitable organization. None of the general administrative overhead would be avoided if the housekeeping program was dropped, but the liability insurance and the salary of the program administrator would be avoided. Should the housekeeping program be discontinued? Does your decision depend on the time horizon (short-run versus long-run)? Show computations to specifically support your conclusion(s). Use the table function to organize your answer. Be sure to discuss how you considered the depreciation charges
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