point(s) possible Free Wheels has a plant that assembles bicycles. The plant currently has a small cafeteria for the workers, but the kitchen equipment is in need of a substantial overhaul. Free Wheels has been offered a contract by Besteats to supply food to the workers. The particulars of the situation are shown in the table. Should Free Wheels continue with the in-house food service or contract the service to Besteats? Food Service: In-House Versus Contract Food service labour (hours/year) 6,250 Wage rate (real, time 1, S/hour) 15 Overhead cost (real, time 1, S/year) 16,000 Kitchen equipment first cost (current, time 0, $) 27,000 Contract cost, years 1 to 3 (current S) 56,000 63,500 24% Contract cost, years 4 to 6 (current $) Current dollar MARR Expected annual inflation rate Study period (years) The contract present worth cost is $ the (Ro as the cost is eeded) 4% 6 and the in-house present worth cost is $, so the company should choose contract, in-house option, (s) possible Free Wheels has a plant that assembles bicycles. The plant currently has a small cafeteria for the workers, but the kitchen equipment is in need of a substantial overhaul Free Wheels has been offered a contract by Besteats to supply food to the workers. The particulars of the situation are shown in the table. Should Free Wheels continue with the in-house food service or contract the service to Besteats? Food Service: In-House Versus Contract Food service labour (hours/year) 6,250 Wage rate (real, time 1, S/hour) 15 Overhead cost (real, time 1, S/year) 16,000 Kitchen equipment first cost (current, time 0, $) 27,000 Contract cost, years 1 to 3 (current $) 56,000 63,500 24% Contract cost, years 4 to 6 (current $) Current dollar MARR Expected annual inflation rate Study period (years) The contract present worth cost is $ the as the cost is (Round to the nearest cent as neede 4% 6 and the in-house present worth cost is $, so the company should choose higher. lower