4-35. Millbridge Family Services (MFS) currently operates a foster care program

4-35. Millbridge Family Services (MFS) currently operates a foster care program that is fully funded by the state. Changinggovernment priorities are expected to result in a 20% reduction in its state foster care funding for the upcoming fiscal year.MFS’s management is considering eliminating the foster care program in the next fiscal year in light of these anticipatedfunding cuts. The total foster care program expenses for the upcoming fiscal year is $120,000. The foster care program’sbudgeted expenses include $25,000 of salaries and occupancy costs that are allocated to its program budget from MFScentral administration. These allocated expenses of $25,000 are unavoidable even if the foster care program iseliminated. What is the total relevant cost that should be considered in making this decision?

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