The CPA firm you work for, Sutton, Alexander, and Jones, has been in practice for five years. The majority of the tax work done for its clients, who are mostly small business, is the preparation of state and federal income tax returns. One of the firm’s tax partners, Hugh Sutton, mentioned to you the possibility that the firm might expand its services to offer tax planning for the owners of small businesses. Write a memo to Mr. Sutton in which you discuss the advantages and disadvantages of offering tax planning as an additional service.

Aaron corporation, which has only one product, has provided the following data concerning its most recent month of operations: selling price $ 102 units in beginning inventory 0 units produced 4,900 units sold 4,260 units in ending inventory 640 variable costs per unit: direct materials $ 20 direct labor $ 41 variable manufacturing overhead $ 5 variable selling and administrative expense $ 4 fixed costs: fixed manufacturing overhead $ 64,200 fixed selling and administrative expense $ 2,900 the total contribution margin for the month under variable costing is: