Total costs X Company?
|
Variable costs: |
|
|
Email license |
$18,625 |
|
Virus protection license |
5,215 |
|
Miscellaneous |
16,390 |
|
Fixed costs |
|
|
Computer hardware |
24,585 |
$10,326 of the computer hardware costs were common costs that will continue even if the email system is abandoned, and X Company will still need to pay for the virus protection license. Y Company has offered to operate an email system for X Company for $11.10 per mailbox. Next year, X Company estimates that 4,190 mailboxes will be required per month. By how much will X Company's monthly profits change if they decide to outsource its email function to Y Company instead of managing the service internally? [A positive number means that make costs are more than buy costs; a negative number means that make costs are less than the buy costs.]