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Required information [The following information applies to the questions displayed below.] B-You is a consulting firm that works with managers to improve their interpersonal skills. Recently, a representative of a high-tech research firm approached B-You's owner with an offer to contract for one year with B-You to improve the interpersonal skills of a newly hired manager. B-You reported the following costs and revenues during the past year. B - YOU Annual Income Statement Sales revenue $ 504,000 Costs Labor 239,400 Equipment lease 35,280 Rent 30, 240 Supplies 22,680 Officers' salaries 147,000 Other costs 15,960 Total costs $ 490,560 Operating profit (loss) $ 13,440 If B-You decides to take the contract to help the manager, it will hire a full-time consultant at $85,000. Equipment lease will increase by 5 percent. Supplies will increase by an estimated 10 percent and other costs by 15 percent. The existing building has space for the new consultant. No new offices will be necessary for this work. Required: a. What are the differential costs that would be incurred as a result of taking the contract? CO 2 3 4 w th O o 99 14