Mr. Brown and Mr. Black own cleaning companies.They are considering renting a small sweeper to share between their two separate businesses.Mr. Brown requires the machine for a total of 900 hours and Mr. Black 600 hours.If each company rents the machine on their own, the hourly rate is $40.If they rent the machine together the hourly rate drops to $32.

REQUIRED:

a)Calculate Mr. Brown's and Mr. Black's respective share of the cost using the stand-alone method.

b)Calculate Mr. Brown's and Mr. Black's respective share of the cost using the incremental method.Assume Mr. Brown to be the primary party.

Answer rating: 100% (QA)

ANSWER To solve this problem lets calculate the costs for Mr Brown and Mr Black using both the stand... View the full answer