Reference no: EM133128118
Question - Knowledge Transfer Associates is in the process of evaluating its new client services for the business systems consulting division.
Server? Planning, a new? service, incurred? $270,000 in development costs.
The direct costs of providing the? service, which is all? labor, averages? $40 per hour.
Other costs for this service are estimated at? $310,000 per year.
The current program for server planning is expected to last for two years. At that? time, expected new operating systems are likely to make the service non viable.
Customer service expenses average? $300 per? client, with each job lasting an average of 60 hours. The current staff expects to bill? 22,800 hours for each of the two years the program is in effect. Billing averages? $100 per hour.
Required - What is the estimated? life-cycle operating income for both years? combined?
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