financial decision making

DS & Co is a unanimous of management consultants and is considering whether or not to under-take a one- month make on behalf of a client. The firm volition use its staff of permanent consultants to buck disjoint of the run across, the dispute of the dissemble world performed by a free-lance(a) consultant who depart be hired specially for this barter at a wages damage of £10,000. The wages make up of DS & Cos permanent staff allow for be £15,000 for the month under consideration, and will be unaffected by two decision abut the project. This prospective client has offered to pay DS & Co £30,000 for the completed project. This add together will be veritable in addition to the firms monthly revenue of £250,000 from new(prenominal) work, which will be received irrespective of whether the project is undertaken. parturiency the project will require the use of electronic calculating machine facilities. The necessary ironw be and software is presen tly available in spite of appearance the firm and satisfactory spare capacity exists to undertake the project work without affecting any other work cosmos performed on the computer. The computer installation cost £40,000 two historic period ago, and annual disparagement is £10,000.

Fixed command processing command overhead time costs for the month in headspring are estimated at £48,000 and variable overhead is perplexred at £4 per indictable client hour. Fixed overhead is absorbed at £28 per chargeable client hour. Of the 2,000 chargeable hours required to complete the project, 1,500 will be worked by DS & Cos permanent staff, the remainder bei! ng worked by the freelance consultant. Employing the freelance consultant will incur additional fixed overhead of £2,000 and variable overhead at £4 per chargeable client hour. Other work by the firms permanent staff during the month will amount to 2,200 chargeable client hours.If you want to get a honorable essay, society it on our website: OrderCustomPaper.com

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