Lunar Entertainment is a provider of cable, internet, and on-demand video services. Lunar currently sends monthly bills to its customers via the postal service. Because of a concern for the environment and recent increases in postal cost of leasing the computer system. The The cost of the paperless billing system would be $117,440 per variable costs since the costs of the system are the salaries of t s billing sys ould be able to handle up to 880,000 bills per quarter (more th unag In adwatereeds)te offering an option to its customers for needs.) Although Lunar would like to switch adogosrm(Cick the ion to wlew the dasa) paperless billing In addition to saving printing, paper, and postal costs, paperless per quarter would require a different computer system and is ou biling will save energy and water (through reduced paper needs, reduced waste the current situation at Lunar.) The company has gathered its co past year by quarter for paper, toner cartridges, printer maintena postage costs for the billing department. The cost data are as fo disposal, and reduced t to 100% paperless billing many of its customers are not comfortable with paperless billing or may not have web access, so the paper biling option will remain regardless of whether Lunar adopts a paperless billing system or not. billngr notR Read the requirements Requirement 1. Calculate the variable cost per bill mailed under the current paper-based billing system. 0 96 The variable cost per bill mailed under the current paper-based billing system is S Requirement 2. Assume that the company projects that it will have a total of 760,000 bills to mail in the upcoming quarter. If enough customers choose billing option so that 20% of the mailings can be converted to paperless, how much would the company save from the paperless billing system be sure cost of the paperless billing system)? The company would save S 28.480 from using the paperless billing system. Requirement 3. What if only 15% of the mailings are converted to the paperless option (assume a total of 760 000 bills)? Should the company still offer s reserved.I TermSOAUSS Lunar Entertainment is a provider of cable, internet, and on-demand video services. Lunar currently sends monthly bills to its customers via the postal service. Because of a concern for the environment and recent increases in postal cost of leasing the computer system. The The cost of the paperless billing system would be $117,440 per variable costs since the costs of the system are the salaries of t s billing sys ould be able to handle up to 880,000 bills per quarter (more th unag In adwatereeds)te offering an option to its customers for needs.) Although Lunar would like to switch adogosrm(Cick the ion to wlew the dasa) paperless billing In addition to saving printing, paper, and postal costs, paperless per quarter would require a different computer system and is ou biling will save energy and water (through reduced paper needs, reduced waste the current situation at Lunar.) The company has gathered its co past year by quarter for paper, toner cartridges, printer maintena postage costs for the billing department. The cost data are as fo disposal, and reduced t to 100% paperless billing many of its customers are not comfortable with paperless billing or may not have web access, so the paper biling option will remain regardless of whether Lunar adopts a paperless billing system or not. billngr notR Read the requirements Requirement 1. Calculate the variable cost per bill mailed under the current paper-based billing system. 0 96 The variable cost per bill mailed under the current paper-based billing system is S Requirement 2. Assume that the company projects that it will have a total of 760,000 bills to mail in the upcoming quarter. If enough customers choose billing option so that 20% of the mailings can be converted to paperless, how much would the company save from the paperless billing system be sure cost of the paperless billing system)? The company would save S 28.480 from using the paperless billing system. Requirement 3. What if only 15% of the mailings are converted to the paperless option (assume a total of 760 000 bills)? Should the company still offer s reserved.I TermSOAUSS
