Lease or Sell Kincaid Company owns equipment with a cost of $363,200 and accumulated depreciation of $55,800 that can be sold for $273,100, less a 5% sales commission. Alternatively, Kincaid Company can lease the equipment for three years for a total of $285,200, at the end of which there is no residual value. In addition, the repair, insurance, and property tax expense that would be incurred by Kincaid Company on the equipment would total $15,100 over the three year lease. a. Prepare a differential analysis on August 7 as to whether Kincaid Company should lease (Alternative 1) or sell (Alternative 2) the equipment. If required, use a minus sign to indicate a loss. Differential Analysis Lease Equipment (Alt. 1) or Sell Equipment (Alt. 2) August 7 Lease Sell Differential Equipment Equipment Effects (Alternative 1) (Alternative 2) (Alternative 2) Revenues Costs Profit (Loss) $1 $ Feedback Check My Work Subtract the lease costs from the lease revenues. Subtract the sell equipment costs from the sell equipment revenues. Determine the differential effect on income of the revenues, costs, and income (loss) by subtracting alternative 1 from alternative 2. Discontinue a Segment Product Tango has revenue of $194,800, variable cost of goods sold of $116,000, variable selling expenses of $31,000, and fixed costs of $58,800, creating an operating loss of $(11,000). a. Prepare a differential analysis as of February 13 to determine if Product Tango should be continued (Alternative 1) or discontinued (Alternative 2), assuming fixed costs are unaffected by the decision. If an amount is zero, enter "O". If required, use a minus sign to indicate a loss. Differential Analysis Continue Product Tango (Alt. 1) or Discontinue Product Tango (Alt. 2) February 13 Continue Discontinue Differential Product Product Effects Tango Tango (Alternative 2) (Alternative 1) (Alternative 2) Revenues Costs: Variable cost of goods sold Variable selling and admin. expenses Fixed costs Profit (Loss) $