Question 4 : [6 marks} Uber Co owns and runs 350 private hired cars and had sales of $10 million in the last year. Cab Co is considering introducing a new computerised taxi tracking system. The expected costs and benets of the new computerised tracking system are as follows: i. The system would cost $2,100,000 to implement. ii. Depreciation would be provided at $420,000 per annum. $75,000 has already been spent on staff training in order to evaluate the potential of the new system. Further training costs of $425,000 would be required in the rst iii. year if the new system is implemented. Sales are expected to rise to $11 million in Year 1 if the new system is implemented, thereafter increasing by 5% per annum. If the new system is not implemented, sales iv. would be expected to increase by $200,000 per annum. Despite increased sales, savings in vehicle running costs are expected as a result v. of the new system. These are estimated at 1% of total sales. Six new members of staff would be recruited to manage the new system at a total vi. costcf$120,000 perannum. vii Uber Co would have to take out a maintenance contract for the new system at a cost cf$T5,000 per annum for ve years. Required: State whether each of the following items are relevant or irrelevant cost or revenue for making decision whether to introduce the computerised tracking system. J Computerised tracking system investment of $2,100,000; J Expected Sales increased by $1,000,000; J Staff training costs of $425,000; J New staff total salary of $120,000 per annum; I Staff training costs of $5,000; J lvlaintainance cost of $150,000 per annum. (BELGIUM { t t t t t h (1 mark each)