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Fact Pattern: A business needs a computer application that can be either developed internally or...

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Accounting

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Fact Pattern: A business needs a computer application that can be either developed internally or purchased. Suitable soffware from a vendor costs $29,000. Minor modifications and testing can be conducted by the systems staff os part of their regular workioad. If the software is developed internally, a systems analyst would be assigned full time, and a contractor would assume the analyst's responsibilities. The hourly rate for the rogular analyst is \$25. The hourfy rate for the contractor is $22. The contractor would occupy an empty office The office has 100 square feet, and occupancy cost is $45 per square foot Other related data are as follows. Computer time is charged using predetermined tates. The organcation has sufficient excess computer capacity for either soffware development or modificationiesting of the purchased software. Based solely on the cost figures presented, the cost of developing the computer application will be A. 59,550 more than scoutring the purchased nofwise packaje d. \$1,550 more than ecguiring the purchased soltware pockage. c. 53,500 less than acquiring the purchased softwire package

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