Hillson & Brady (H&B), a janitorial service, has two clients, Greeley Hospital and Greeley Junior High School.
Question:
This analysis apparently shows that Greeley Hospital is not profitable for H&B. Total fixed costs would not be affected by the decision to discontinue the hospital account. Use differential analysis to determine whether H&B should discontinue the hospitalaccount.
Transcribed Image Text:
Greeley Hospital Greeley Junior High Total Revenues (fees charged) Operating Costs $920 $1,400 $2,320 Cost of Services (variable) Salaries, Rent, and General Administration (fixed) Total Operating Costs $848 $1,220 $2,068 80 $928 S (8) 120 $1,340 $ 60 200 $2,268 S 52 Operating Profits
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Alternative Status Quo Difference Drop Hospital Total Revenues Fees Charged 1400 2320 92...View the full answer
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Related Book For
Managerial Accounting An Introduction to Concepts Methods and Uses
ISBN: 978-0324639766
10th Edition
Authors: Michael W. Maher, Clyde P. Stickney, Roman L. Weil
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