Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The Theater Arts Guild of Dallas (TAG-D) employs five people in its Publication Department. These people lay out pages for pamphlets, brochures, magazines, and other

image text in transcribed
image text in transcribed
The Theater Arts Guild of Dallas (TAG-D) employs five people in its Publication Department. These people lay out pages for pamphlets, brochures, magazines, and other publications for the TAG-D productions. The pages are delivered to an outside company for printing. The company is considering an outside publication service for the layout work. The outside service is quoting a price of $13 per layout page. The budget for the Publication Department for the current year is as follows: Salaries Benefits Supplies Office expenses Office depreciation $224,000 36,000 21,000 39,000 28,000 24,000 $372,000 Computer depreciation Total The department expects to lay out 24,000 pages for the current year. The Publication Department office space and equipment would be used for future administrative needs, if the department's function were purchased from the outside. a. Prepare a differential analysis dated February 22 to determine whether TAG-D should lay out pages internally (Alternative 1) or purchase layout services from the outside (Alternative 2). If an amount is zero, enter "O". Differential Analysis Lay Out Pages Internally (Alt. 1) or Purchase Layout Services (Alt. 2) February 22 MTLICHTEGIA Lay Out Pages Internally (Alt. 1) or Purchase Layout Services (Alt. 2) February 22 Lay Out Purchase Pages Layout Differential Internally Services Effects (Alternative 1) (Alternative 2) (Alternative 2) Costs: Purchase price of layout work Salaries Benefits Supplies Office expenses omce depreciation Computer depreciation Total costs o b. The benefit from using an outside service is shown to be than performing the layout work internally. The fixed costs (depreciation expenses) in the budget are to the decision. Thus, the work should purchased from the outside on a strictly financial basis c. Before electing to the five employees, the TAG-D should consider the of the decision

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting For Financial Instruments

Authors: Cormac Butler

1st Edition

0470699809, 978-0470699805

More Books

Students also viewed these Accounting questions

Question

b. Did you suppress any of your anger? Explain.

Answered: 1 week ago