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There are two problems for this Modules CT Assignment. Boxx Corporation is considering the acquisition of new equipment. The equipment can be purchased from an
There are two problems for this Modules CT Assignment.
- Boxx Corporation is considering the acquisition of new equipment. The equipment can be purchased from an overseas supplier for $6,500. The freight and installation costs for the equipment are $615. If purchased, annual repairs and maintenance are estimated to be $445 per year over the five-year useful life of the equipment. Alternatively, Boxx can lease the equipment from a domestic supplier for $1,850 per year for five years, with no additional costs.Required:
- Prepare a differential analysis to determine whether Boxx should lease (Alternative 1) or purchase (Alternative 2) the equipment.
- Indicate specifically the company should lease or buy the equipment after completing the analysis. Explain.Hint: This is a lease orbuy decision, which must be analyzed from the perspective of the equipment user as opposed to the equipment owner.
- A condensed income statement by product line for Astronomy Baking Inc. indicated the following for Moon Cookies for the past year:
Sales $450,000 Cost of goods sold 205,000 Gross profit 245,000 Operating expenses 287,000 Loss from operations ($42,000) - Prepare a differential analysis to determine whether Moon Cookies should be continued (Alternative 1) or discontinued (Alternative 2).
- Should Moon Cookies be retained? Explain.
Use an Excel spreadsheet for each of the two problems.
*the last solution include false answer which cause me to lose up 30 point from the grade*
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