Tax return preparation during the busy season

Reference no: EM131705007

Juan's Pro-Tax Service is deciding whether to buy software to expedite some of its tax return preparation during the busy season. Juan charges a customer $420 for this type of return. He pays his employee $1.70 per minute, and it takes about 65 minutes to complete the return. Two companies provide an online service, and charge a fixed fee per return. If Juan buys software from Company A, they would charge him $3.70 per return, and the preparation would take 16 minutes less. If he buys from Company B, they would charge him $5.70 per return, and the preparation would take 21 minutes less.

A. What is the productivity for each option? (Use two decimal places for both intermediate calculations and final answers. Do not use the dollar sign when you type in your answer.)

Current

Company A

Company B

B. Which option should Juan choose?

Reference no: EM131705007

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