22.

Question Content Area

Support Department Allocations

The centralized computer technology department of Hardy Company has expenses of $165,000. The department has provided a total of 5,000 hours of service for the period. The Retail Division has used 3,900 hours of computer technology service during the period, and the Commercial Division has used 1,100 hours of computer technology service.

How much should each division be allocated for computer technology department services? Do not round interim calculations.

Retail Division	$fill in the blank 1
Commercial Division

24.

1. Question Content Area

   Lease or Sell

   Casper Company owns equipment with a cost of $368,000 and accumulated depreciation of $53,200 that can be sold for $277,200, less a 5% sales commission. Alternatively, Casper Company can lease the equipment for three years for a total of $284,500, at the end of which there is no residual value. In addition, the repair, insurance, and property tax expense that would be incurred by Casper Company on the equipment would total $14,900 over the three year lease.

   Question Content Area

   a. Prepare a differential analysis on August 7 as to whether Casper Company should lease (Alternative 1) or sell (Alternative 2) the equipment. If required, use a minus sign to indicate a loss.

   Differential Analysis Lease Equipment (Alt. 1) or Sell Equipment (Alt. 2) August 7

   	Lease Equipment (Alternative 1)	Sell Equipment (Alternative 2)	Differential Effects (Alternative 2)
   Revenues	$fill in the blank bb9759073fc0fe3_1	$fill in the blank bb9759073fc0fe3_2	$fill in the blank bb9759073fc0fe3_3
   Costs	fill in the blank bb9759073fc0fe3_4	fill in the blank bb9759073fc0fe3_5	fill in the blank bb9759073fc0fe3_6
   Profit (Loss)	$fill in the blank bb9759073fc0fe3_7	$fill in the blank bb9759073fc0fe3_8	$fill in the blank bb9759073fc0fe3_9

   Question Content Area

   b. Should Casper Company lease (Alternative 1) or sell (Alternative 2) the equipment?

   Lease the equipmentSell the equipment