Calculate mr brown and mr black respective share

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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:

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

Problem 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.

Reference no: EM132815642

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