Prepare a differential analysis dated February 22 to determine whether TAG-D should layout pages internally (Alternative 1) or purchase layout services from the outside (Alternative 2). If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign. Make-or-Buy Decision for a Service Company The Theater Arts Guild of Dallas (TAG-D) employs five people in its Publication Department. These people lay out pages for pamphlets, brochures, magazines, and other publications for the TAG-D productions. The pages are delivered to an outside company for printing. The company is considering an outside publication service for the layout work. The outside service is quoting a price of $14 per layout page. The budget for the Publication Department for the current year is as follows: Salaries $166,300 Benefits 37,800 Supplies 20,200 Office expenses 25,200 Office depreciation 22,700 Computer depreciation 15,100 Total $287,300 The department expects to lay out 18,000 pages for the current year. The Publication Department office space and equipment would be used for future administrative needs, if the department's function were purchased from the outside. a. Prepare a differential analysis dated February 22 to determine whether TAG-D should layout pages internally (Alternative 1) or purchase layout services from the outside (Alternative 2). If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign. Differential Analysis Lay out Pages Internally (Alt. 1) or Purchase Layout Services (Alt. 2) February 22 Lay out Pages Internally (Alternative 1) Purchase Lay out Services (Alternative 2) Differential Effect on Income (Alternative 2) Sales price $fill in the blank 6822c6029019053_1 $fill in the blank 6822c6029019053_2 $fill in the blank 6822c6029019053_3 Costs: Purchase price of lay out work $fill in the blank 6822c6029019053_4 $fill in the blank 6822c6029019053_5 $fill in the blank 6822c6029019053_6 Salaries fill in the blank 6822c6029019053_7 fill in the blank 6822c6029019053_8 fill in the blank 6822c6029019053_9 Benefits fill in the blank 6822c6029019053_10 fill in the blank 6822c6029019053_11 fill in the blank 6822c6029019053_12 Supplies fill in the blank 6822c6029019053_13 fill in the blank 6822c6029019053_14 fill in the blank 6822c6029019053_15 Office expenses fill in the blank 6822c6029019053_16 fill in the blank 6822c6029019053_17 fill in the blank 6822c6029019053_18 Office depreciation fill in the blank 6822c6029019053_19 fill in the blank 6822c6029019053_20 fill in the blank 6822c6029019053_21 Computer depreciation fill in the blank 6822c6029019053_22 fill in the blank 6822c6029019053_23 fill in the blank 6822c6029019053_24 Income (loss) $fill in the blank 6822c6029019053_25 $fill in the blank 6822c6029019053_26 $fill in the blank 6822c6029019053_27 Feedback a. For the make and buy alternatives provide the costs. Determine the differential effect on income of the revenues, costs, and income (loss) by subtracting alternative 1 from alternative 2. b. The benefit from using an outside service is shown to be than performing the layout work internally. The fixed costs (depreciation expenses) in the budget are to the decision. Thus, the work should purchased from the outside on a strictly financial basis. c. Before electing to the five employees, the Guild should consider the of the decision.
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
a. Prepare a differential analysis dated February 22 to determine whether TAG-D should layout pages internally (Alternative 1) or purchase layout services from the outside (Alternative 2). If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign.
Make-or-Buy Decision for a Service Company
The Theater Arts Guild of Dallas (TAG-D) employs five people in its Publication Department. These people lay out pages for pamphlets, brochures, magazines, and other publications for the TAG-D productions. The pages are delivered to an outside company for printing. The company is considering an outside publication service for the layout work. The outside service is quoting a price of $14 per layout page. The budget for the Publication Department for the current year is as follows:
| Salaries | $166,300 |
| Benefits | 37,800 |
| Supplies | 20,200 |
| Office expenses | 25,200 |
| Office |
22,700 |
| Computer depreciation | 15,100 |
| Total | $287,300 |
The department expects to lay out 18,000 pages for the current year. The Publication Department office space and equipment would be used for future administrative needs, if the department's function were purchased from the outside.
a. Prepare a differential analysis dated February 22 to determine whether TAG-D should layout pages internally (Alternative 1) or purchase layout services from the outside (Alternative 2). If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign.
| Differential Analysis | |||
| Lay out Pages Internally (Alt. 1) or Purchase Layout Services (Alt. 2) | |||
| February 22 | |||
| Lay out Pages Internally (Alternative 1) |
Purchase Lay out Services (Alternative 2) |
Differential Effect on Income (Alternative 2) |
|
| Sales price | $fill in the blank 6822c6029019053_1 | $fill in the blank 6822c6029019053_2 | $fill in the blank 6822c6029019053_3 |
| Costs: | |||
| Purchase price of lay out work | $fill in the blank 6822c6029019053_4 | $fill in the blank 6822c6029019053_5 | $fill in the blank 6822c6029019053_6 |
| Salaries | fill in the blank 6822c6029019053_7 | fill in the blank 6822c6029019053_8 | fill in the blank 6822c6029019053_9 |
| Benefits | fill in the blank 6822c6029019053_10 | fill in the blank 6822c6029019053_11 | fill in the blank 6822c6029019053_12 |
| Supplies | fill in the blank 6822c6029019053_13 | fill in the blank 6822c6029019053_14 | fill in the blank 6822c6029019053_15 |
| Office expenses | fill in the blank 6822c6029019053_16 | fill in the blank 6822c6029019053_17 | fill in the blank 6822c6029019053_18 |
| Office depreciation | fill in the blank 6822c6029019053_19 | fill in the blank 6822c6029019053_20 | fill in the blank 6822c6029019053_21 |
| Computer depreciation | fill in the blank 6822c6029019053_22 | fill in the blank 6822c6029019053_23 | fill in the blank 6822c6029019053_24 |
| Income (loss) | $fill in the blank 6822c6029019053_25 | $fill in the blank 6822c6029019053_26 | $fill in the blank 6822c6029019053_27 |
a. For the make and buy alternatives provide the costs. Determine the differential effect on income of the revenues, costs, and income (loss) by subtracting alternative 1 from alternative 2.
b. The benefit from using an outside service is shown to be than performing the layout work internally. The fixed costs (depreciation expenses) in the budget are to the decision. Thus, the work should purchased from the outside on a strictly financial basis.
c. Before electing to the five employees, the Guild should consider the of the decision.
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