Your company has suffered a server-farm meltdown, and the person responsible for the backups hasn't returned from a trip he took to Tahiti early last year. All your company's data will need to be re-entered by hand and all hardware will be replaced and updated. You, the Project Manager, have to decide whether you should perform this monumental task in-house (Build), or outsource it to Luke's Sensitive Data and Recovery, located in Portland, Oregon (Buy). The costs for this project will be substantial, so a careful analysis is required. Estimates for each option are as follows: (20) BUILD Create the equation to build using the following information: Hardware Costs: nine (9) new computers will be needed for this project, since all the available computers your company currently owns need to be updated. Each new computer will cost $1,855.00. You will also need to purchase the Extended Warranty at a price of $450.00 per machine Service Costs: Your current Computer Maintenance Services Company will cover the new machines at 1/3 their normal rate of $165 per machine per day for the first year, at which time the machines will be useless, completely obsolete, and given away as Door Prizes at the semi-annual company Arbor Day party. The per-day charge is non-negotiable, applied every day of the week (whether the machines are in use or not), and each years charges must be paid for up front, in cash Labor Costs: Since your company CEO has a really bad habit of hiring unqualified and inexpensive staff, you will need to staff your new computers with Software Engineers (SE) and Computer Programmers (CP). Each of the three (3) SE's assigned to your project make $88 per hour (8 hour day), and each of the four (4) CP's make $67 per hour (8 hour day). Since this project is so important, and since all your SE's and CP's have threatened to quit because they want a raise management has also agreed to pay Key Assignment Bonuses to the seven (7) employees to get them on-board. Each SE will be paid a $10,100 cash bonus, and each CP will be paid a $7,800 cash bonus. SE's and CP's are both assigned to work on this project 7 days per week (8 hour day), with no additional overtime or benefit costs incurred. Training will be provided for all new employees. Two trainers will be brought in, each charging $50 per hour. The training will be for 2 weeks; 10-8hr days total. The trainers will be paid in full before training begins Nine employees will also be given iPhones and will be required to keep in close contact at all times including weekends. The iPhones were purchased several months ago. However, there will be a monthly contract fee of $1,086.90 (based on a 30 day month) for each phone
