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Jenson College provides its own housekeeping services. The College director would like to outsource this service and has found a company that will provide the

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Jenson College provides its own housekeeping services. The College director would like to outsource this service and has found a company that will provide the service for $51 per hour. The following information has been collected about the cost per hour to the college for performing its own housekeeping services: Cost per hour of service: Cleaning supplies Direct labour costs Variable overhead Total hours of housekeeping services per year Total fixed overhead $4 $27 $1 3,260 $52,440 (a) Determine whether Jenson College should outsource housekeeping, assuming that 50% of fixed costs can be eliminated if the service is outsourced. (If an amount reduces the net income then enter with a negative sign preceding the number, e.g-15,000 or parenthesis, 28. (15,000)) Net Income Increase (Decrease) In-house Outsource Number of hours: 3.260 Cleaning supplies Direct labour $ Variable overhead Fixed costs Purchase price Total cost $ Jenson College outsource the services

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