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Cullumber Communications operates a customer call center that handles billing inquiries for several large insurance firms. Since the center is located on the outskirts of town, where there are no restaurants within a 20-minute drive, the company has always operated an on-site cafeteria for employees. The cafeteria uses $165,000 in food products each year and serves 5,000 meals per month, at a price of $5 each. It employs five workers whose salaries and benefits total $100,000 per year. Depreciation on the cafeteria equipment is $20,000 per year. Other fixed overhead that is directly related to operating the cafeteria totals $13,000 per year. Ivanhoe Foods has offered to take over Cullumber's cafeteria operations. As part of the transition, current cafeteria employees would become Ivanhoe employees, and Ivanhoe would assume all out-of-pocket costs to operate the cafeteria. Ivanhoe would continue to offer meals at $5 each and would pay Cullumber $1 per meal for the use of its cafeteria facilities. (a) Your answer is partially correct. Calculate the net revenue from cafeteria operations and revenue from outsourcing the cafeteria to Ivanhoe Foods. Net revenue from operating the cafeteria $ Revenue from outsourcing the cafeteria $ Should Cullumber continue to operate the employee cafeteria, or should the company accept Ivanhoe's offer? Cullumber should accept Ivanhoe's offer

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